April 2, 2013 / 3:15 PM / 5 years ago

Legg Mason's Dewhurst to leave, passed over in CEO search

April 2 (Reuters) - Legg Mason Inc said on Tuesday that Ronald Dewhurst will leave the company he once hoped to lead as its next chief executive.

The Baltimore fund firm reported in a press release that Dewhurst, formerly head of global investment managers, and Thomas Lemke, its general counsel, will both leave as part of a leadership shuffle overseen by newly-appointed CEO Joseph Sullivan.

Sullivan, previously Legg Mason’s sales chief, was named to lead the company in February after a five-month search to replace prior CEO Mark Fetting following his departure at the start of October. Dewhurst at one point was the other leading internal candidate for the job. [ ID:nL1E9C745E ]

With $661 billion under management at the end of February, Legg Mason is among the largest publicly-traded U.S. asset managers. But unlike peers it has reported outflows of investor cash nearly every quarter since the financial crisis, tied to the mixed performance of some of its mutual funds.

Results have improved of late and Sullivan has vowed changes like offering Legg Mason’s affiliated investment managers equity in their own firms to turn things around. But like Fetting, Sullivan will be under pressure to end the outflows.

In its release, Legg Mason said Chief Financial Officer Peter Nachtwey is staying in place and described promotions for several others it named new members of its executive committee.

Appointments include Terry Johnson as head of global distribution, Jennifer Murphy as chief administrative officer, and Thomas Merchant as general counsel, replacing Lemke.

Legg Mason said it also is in the process of hiring an executive to lead an expanded “Business and Product Development” function, to create new products either through acquisitions or internal development.

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