Legg Mason to buy Hagstrom's investment firm Seller wrote book about Warren Buffett; Securities industry


Legg Mason Inc. has entered into an agreement to buy the investment company run by Robert G. Hagstrom Jr., the author of a best-selling book about billionaire investor Warren Buffett, according to a document filed with the Securities and Exchange Commission.

The Baltimore-based brokerage and money management firm plans to buy Focus Capital Advisory LP for an undisclosed price.

Edward A. Taber III, a senior executive vice president at Legg, declined to discuss the transaction. "We might possibly be in the position over the next day or two to say something, possibly," Taber said. "There are some moving parts that have not moved dTC to their conclusion."

Hagstrom, the chairman of Focus, manages more than $8 million in Focus Trust Inc. He will become an employee of Legg Mason Fund Adviser Inc., according to Focus Capital's proxy statement filed with the SEC May 28.

Hagstrom is friends with William H. Miller III, manager of Legg Mason's highly successful Value Trust mutual fund. Both portfolio managers have been greatly influenced by Buffett, whom some call the greatest investor of all time. Hagstrom was so taken by Buffett's investment style that he wrote a book called "The Warren Buffett Way" in 1994.

Hagstrom has invested in companies into which Buffett has plowed millions, such as the Walt Disney Co., the Washington Post Co. and McDonald's Corp. He even pumped more than $470,000 into Omaha, Neb.-based Berkshire Hathaway Inc., the investment company run by Buffett.

Pub Date: 6/03/98

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