Ameriprise to buy J&W Seligman for $440 million

Financial services firm Ameriprise Financial Inc. said Monday it agreed to acquire asset management firm J&W Seligman & Co. for $440 million.

New York-based Seligman manages about $18 billion in assets in open- and closed-end funds, hedge funds and institutional accounts. Ameriprise said it expects the deal, which should close in the fourth quarter, to boost its 2009 earnings and return on equity.

Ameriprise said that the addition of Seligman's about $3 billion in hedge fund assets will substantially increase its alternative investment activities.

"This transaction reinforces our growth strategy, and in particular our efforts to grow our higher-margin businesses," Jim Cracchiolo, Ameriprise's chairman and chief executive, said in a statement.

The deal will be funded with cash on hand.

UBS Investment Bank acted as financial adviser and Ropes & Gray LLP acted as legal adviser for Ameriprise Financial. Merrill Lynch acted as financial adviser and Cleary Gottlieb Steen & Hamilton LLP acted as legal adviser for Seligman.

Ameriprise shares fell 10 cents to $39.78 in afternoon trading, and hit a 52-week low of $38.16 earlier in the session.