CORRECTED-UPDATE 1-Waddell & Reed sells Legend investment unit

Wed Oct 31, 2012 10:50am EDT

(Corrects paragraph 2 to clarify that the company said the charge is in the third quarter, not fourth quarter)

Oct 31 (Reuters) - Asset manager Waddell & Reed Financial Inc said it agreed to sell its Legend investment unit to First Allied Holdings Inc to focus on its core asset management business.

The company took a non-cash charge of $42.4 million in the third quarter, related to the write-down of Legend as a result of the sale.

Waddell & Reed acquired The Legend Group, a mutual fund distribution and retirement planning company held privately earlier, for about $75 million in February 2000.

The sale was announced as the company reported a net income from continuing operations, excluding Legend, of $52.1 million, or 61 cents per share, up from $39.4 million, or 46 cents per share, a year earlier.

Total operating revenue was up 5 percent to $293.4 million.

Waddell & Reed, known for its Ivy fund family, ended the quarter with $95 billion in assets under management.

Shares of the Overland Park, Kansas-based company closed at $32.62 last Friday on the New York Stock Exchange. (Reporting by Ashutosh Pandey and Aman Shah in Bangalore)

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