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Smith Barney downplays impact of Morgan Stanley merger to clients(Record, The (Hackensack, NJ) Via Acquire Media NewsEdge) Jan. 17--Smith Barney brokers in New Jersey have been busy this week assuring clients that in spite of Tuesday's announcement of a pending joint venture and merger with Morgan Stanley, they should expect business to carry on as usual. Smith Barney, which traces its roots back to 1873, serves 9.2 million clients nationwide. New Jersey, with about 20 offices and 1,100 employees, is a key market. "Client communications have been made available to advisers assuring them of continuity of service, and expressing enthusiasm about what we think will be a terrific business," said Alexander Samuelson, a Smith Barney spokesman. "There is no forced migration of clients or anything," he said. "Nothing changes," added a spokeswoman for Morgan Stanley, which has 392 financial advisers and 10 offices in its New Jersey district. Morgan Stanley will buy a controlling stake in Smith Barney, paying parent Citigroup Inc. $2.7 billion. Citi will retain a 49 percent share in the joint venture. The combined brokerage will be the country's largest with more than 20,000 financial advisers and $1.7 trillion in client assets. A couple of Bergen County securities lawyers -- a client of Smith Barney and a former customer -- also say the deal is, for clients, little cause for concern. "From the customers' standpoint, it really doesn't make a difference," said Stephen Roger Bosin, a former Securities and Exchange Commission lawyer now in private practice. Peter Pearlman, of the Saddle Brook law firm Cohn Lifland Pearlman Herrmann & Knopf, said, "I wouldn't recommend that clients flee Smith Barney, or that they flee Morgan Stanley. There are some good brokers at both places and poor brokers at both places." Pearlman has a retirement account with a Smith Barney broker in New York and he plans to stick with that broker after the merger is finalized, expected in the third quarter. Pearlman said he anticipates little if any change in service or fees when Smith Barney is folded in to Morgan Stanley. The combined companies will almost certainly reduce staff to eliminate redundancy and meet cost-cutting goals. Pearlman said it is unlikely that many brokers will be cut loose. "They will probably be inclined to retain brokers," Pearlman said. The size of the combined brokerages will make it attractive to companies seeking channels to launch public offerings, Bosin noted, and that could be a benefit to clients who want to get in on the ground floor of IPOs. "They will have a huge network to sell stock," he said. To see more of The Record, or to subscribe to the newspaper, go to http://www.NorthJersey.com. Copyright (c) 2009, The Record, Hackensack, N.J. Distributed by McClatchy-Tribune Information Services. For reprints, email [email protected], call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA. |