Franklin Resources is buying competitor Legg Mason for US$4.5 billion, creating a financial company with a combined US$1.5 trillion in assets under management. Franklin Resources Inc, which operates as Franklin Templeton, said Tuesday that it would pay US$50 for each Legg Mason Inc share and also assume about US$2 billion in outstanding debt. Bloomberg reported earlier on Tuesday of the potential all-cash deal at 23 per cent premium to Legg Mason’s stock closing price on Friday. The deal strengthens Templeton’s presence in key geographies and creates an investment platform that is well balanced between institutional and retail client assets under management. The deal is expected to close no later than 2020’s third quarter. Nelson Peltz’s Trian Fund Management LP and funds managed by it own about 4.5 per cent of Legg Mason’s outstanding stock and have entered into a voting agreement in support of the transaction. Shares of Legg Mason jumped more than 20 per cent in New York before the opening bell. The combination comes as active money managers face unprecedented pressures on fees and have been trimming staff to control costs, forcing industry players to consolidate. Jupiter Fund Management Plc agreed to acquire rival UK asset manager Merian Global Investors on Monday. Reporting by AP, Bloomberg Purchase the China AI Report 2020 brought to you by SCMP Research and enjoy a 20% discount (original price US$400). This 60-page all new intelligence report gives you first-hand insights and analysis into the latest industry developments and intelligence about China AI. Get exclusive access to our webinars for continuous learning, and interact with China AI executives in live Q&A. Offer valid until 31 March 2020.