Baltimore, MD (July 7, 2008)--Brown Advisory and Alex. Brown Investment Management (ABIM), two leading Baltimore-based investment firms, announced today that ABIM will join the Brown Advisory team, making the combined firm one of the pre-eminent independent investment advisory firms in the mid-Atlantic region. Both firms serve institutional clients as well as high net worth individuals and families. The combined firm will have approximately $18 billion in client assets and will operate under the Brown Advisory name. Terms of the agreement were not disclosed.
The two firms also share a common heritage, as each was once part of Alex. Brown & Sons but is now independently owned. Brown Advisory was purchased from BT Alex. Brown by its employees and directors in 1998, and ABIM was similarly purchased in 2001. Today, they share a strong commitment to remaining independent in ownership as well as thought and perspective. Each firm believes that independence is an important attribute in an era in which many firms face potential conflicts in serving as principals whose interests may be opposed to those of their clients.
"We’ve known the entire ABIM team for many years and have always had tremendous respect for them and the results they’ve delivered to clients,” said Michael D. Hankin, CEO of Brown Advisory. “Their research is excellent, and their senior portfolio managers, who average 35 years of investment experience, will add depth and breadth to our investment team.”
“We think our combination is right for the times,” said J. Dorsey Brown III, founder of ABIM. “In an increasingly treacherous investment environment, diversification across asset classes makes sense for clients and investment firms. We believe that, over the long term, clients are best served by a strong and stable firm that combines the entrepreneurial spirit with multiple disciplines—which is the result we achieve by joining forces.”
ABIM’s investment managers will continue their flexible value approach in conjunction with Brown Advisory’s existing large-cap value portfolio management team, which itself has compiled an excellent record under the leadership of senior portfolio manager Rick Bernstein. Bernstein said, “ABIM’s people are known as original and creative investment thinkers who have successfully developed a ‘flexible value’ portfolio management style that has significantly out-performed the market averages over a long period of time. We look forward to working together.”
Enhancing the firms’ respective investment capabilities was the most important consideration in the decision to combine operations. Both firms have a clear commitment to independent, primary research and have built solid capabilities with proven track records in this area. Together, the firm will have over 20 senior analysts, putting it on a par with much larger, more diversified firms. ABIM focuses on its flexible value style of investing, while Brown Advisory has multiple styles, including large-cap growth, large-cap value and small-cap growth.
In addition to its “in-house” investment disciplines, Brown Advisory has developed a growing number of “open architecture” relationships with various sub-advisors in international equities, emerging markets, small-cap value, hedge funds, private equity and real estate. Combined with the firm’s proprietary investment capabilities, this program offers clients access to a full array of investment styles and asset classes.
Both ABIM and Brown Advisory have a number of important national and international client relationships, based on their strong investment results. About one-third of the combined firm’s advisory assets are managed for institutional clients in the mid-Atlantic region and beyond.
Brown Advisory was founded in 1993 as an affiliate of Alex. Brown & Sons. Based in Baltimore, Alex. Brown was one of the oldest and most respected names in American finance and became a major investment banking firm specializing in the research and financing of growth companies. After Alex. Brown was acquired by Bankers Trust in late 1997; Brown Advisory was taken private in 1998. The firm is now owned by its employees, directors, and a few client families. July 1 marked its tenth anniversary as an independent firm.
ABIM was founded in 1974 as an affiliate of Alex. Brown & Sons, although its roots go back to the 1960s, when Dorsey Brown started an investment advisory business as part of Robert Garrett & Sons prior to that firm’s merger with Alex. Brown.