Legg Mason (NYSE:LM) announced plans on Tuesday to part ways with CEO Mark Fetting, who plans to step down from the struggling asset manager at the end of the month.
Baltimore-based Legg Mason didn’t disclose a specific reason for Fetting’s departure, but the executive had been unable to guide the company’s stock price back near pre-recession levels.
Hired in early 2008, Fetting became just the second CEO in Legg Mason’s history and also serves as chairman.
“The opportunity to lead Legg Mason through a crucial period of its history has been both challenging and fulfilling,” Fetting said in a statement. “Now is the right time for new leadership to take the baton and continue to move the company forward into its next phase of growth and development.”
In July Legg Mason disclosed its 19th straight month of quarterly outflows. Its stock has retreated about 3% in the past year and is down almost 70% over the last half decade.
Fetting will step down effective October 1 but stay on as a consultant through the end of the year.
Legg Mason said it has formed a search committee and will engage a leading executive search firm to consider internal and external CEO candidates.
In the mean time, the board tapped Joseph Smith, head of the company’s global distribution, to serve as interim CEO.
Legg Mason’s lead director, W. Allen Reed, will also take over as non-executive chairman. Reed has previous experience as an executive at General Motors (NYSE:GM) and Delta Air Lines (NYSE:DAL).
Fetting “has been instrumental in reducing the company's cost structure, improving its balance sheet and liquidity, and positioning the company for future growth,” Allen said. “On behalf of the entire board, I want to thank Mark for his dedication and his many contributions to Legg Mason.”
Shares of Legg Mason were inactive ahead of the opening bell on Tuesday.