Last week's rumors were on target -- FleetBoston is buyer of Liberty Financial's asset management units. The bank will pick up Liberty's fund units as a part of the deal.

The bank will pay $900 million cash for the unit and assume another $110 million of debt. The price tag seems a relative bargain as the unit manages some $51 billion in assets. That would price the deal at just two percent of assets, or less than half the amount of deals last summer.

Liberty's fund units include: Colonial Management Associates, Stein Roe & Farnham, Crabbe Huson Group, Liberty Asset Management Company, Liberty Funds Distributor, Liberty Funds Services, Newport Pacific Management, Progress Investment Management, and Liberty Wanger Asset Management Company, which includes the Liberty Acorn Funds. Approximately 65 percent of Liberty's assets under management are in mutual funds, with the remainder invested for institutional clients.

"FleetBoston has been clear about growing higher margin, fee-based businesses, such as asset management," said Terrence Murray, FleetBoston's Chairman and Chief Executive Officer. "Through this transaction, FleetBoston will now have the elements in place for substantial growth in the asset management business through distribution of a full range of investment products across all channels, managed by some of the best investment talent in the business."

"FleetBoston's substantial assets under management and financial capacity to grow the business will offer Liberty's mutual fund and institutional customers an even broader array of investment products and services," said Gary L. Countryman, president and chief executive officer of Liberty Financial Companies.

Separately, Liberty revealed in filings with the SEC that it is cutting the commission it charges on nine bond funds and four stock funds to 3 percent from 5.75 percent. It is also increasing the payout to brokers on these funds.

The sale on the funds' "A" shares -- including those of Growth & Income, Select Value, Liberty Acorn USA and Liberty Acorn Twenty -- started on June 1 and will run through July.

The decision to reduce commissions while raising broker payouts was reportedly made to encourage advisors to reallocate client portfolios overweight in growth funds to value and fixed income funds.

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