Brokers at Citi have failed to meet targets for selling Legg Mason Funds, sparking a renegotiation of the distribution deal, Financial News
(subscription required) reported, citing unnamed sources. The exclusive three-year distribution pact formed part of the asset swap undertaken by Citi and Legg in 2005. An analyst told Financial News
that "Citi needs Legg more than Legg needs Citi because a lot of Legg’s financial advisers that went to Citi could go and set up their own businesses if the exclusive deal is terminated." The 2005 asset swap agreement included a performance review after 18 months, with a provision for renegotiation if certain conditions are not met, according to the report.
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