City National Corporation (CNC), the parent company of City National Bank has agreed to acquire a majority stake in Lee Munder Capital Group (LMCG), a Boston-based investment firm that manages assets for corporations, pensions, endowments and affluent households.
LMCG will merge with Independence Investments, a Boston-based institutional asset management firm in which City National holds a majority interest. The combined company will become City National’s primary institutional asset management affiliate. With more than $4 billion of assets under management, it will operate under the LMCG name and as an affiliate of Convergent Capital Management, the Chicago-based asset management holding company that was acquired by City National in 2003.
LMCG President Kenneth Swan will join as the combined firm’s Chief Executive Officer. He and Chief Investment Officer Jeffrey Davis will oversee investment decisions and risk management. The firm’s founder, Lee Munder, will have a significant and broadly held minority interest in the business.
Richard Gershen, Executive Vice President of Wealth Management for City National, said: “The combination of high-quality product offerings from Lee Munder and Independence will strengthen and diversify the institutional asset management capabilities available to our clients. The combined firm will have the management and investment talent, financial strength, infrastructure and marketing capabilities needed to grow and provide clients with long-term investment performance and superior service.”
Munder, Founder and current CEO of LMCG, said: “It allows us to broaden our distribution, gives us additional growth capital and provides a knowledgeable partner dedicated to the investment management business. In addition, our senior management has an increased equity stake in the company as well as a clear path to acquire more equity ownership as the firm grows. This will enable the firm to consistently attract and retain talented people.”
