Axa Group's hire of Mellon Financial Corp. president Christopher M. "Kip" Condron gives the company an executive with a strong track record in building asset management and distribution capabilities to run its U.S. unit, Axa Financial Inc.
For Axa Financial, Mr. Condron's appointment is part of a management reshuffle in which Edward D. Miller, 60, will move to Axa Group's supervisory board, where he will act as a senior adviser to Henri de Castries, Axa's chief executive officer.
The move snares from Mellon one of its most highly regarded executives. Mr. Condron helped the company navigate its way through a transformation that gave it one of the biggest bank-owned asset management units in the country.
Mellon's Dreyfus Corp., which Mr. Condron also chaired, has seen assets jump 12% since the beginning of the year, to $149.5 million, in an otherwise grim market for investments. Mellon's total assets under management now total $520 billion.
During a press conference Wednesday, Mr. Miller sounded upbeat about the change. "I'm committed to the group, and the partnership with Kip is one I'm looking forward to. The chemistry is good," he told analysts on a transatlantic conference call.
Mr. Condron, meanwhile, described his appointment as a chance to work for a truly global financial services company, where he will head up such brands as Axa Advisors, Equitable Life Assurance Society, Sanford C. Bernstein, and Alliance Capital Management.
"I really believe when you look at financial services, to be a true winner you really need to be global, and today there are only a few global companies, and Axa is one," Mr. Condron said. He will take the reins next month, a spokeswoman said.
Observers said that Mr. Miller and Mr. Condron had both been looking to change their respective circumstances for some time.
One analyst in Europe, where Mr. Condron is not widely known, speculated that Mr. Miller's decision to step back from day-to-day responsibilities may have been prompted by his inability to pursue acquisitions using proceeds from Axa's sale last year of its New York investment banking firm, Donaldson Lufkin & Jenrette Inc., to Credit Suisse Group.
"My feeling is Ed Miller sold DLJ to finance acquisitions," said the analyst, who declined to be named. But shortly after selling DLJ, Axa Group took over the minority stake of Axa Financial that was publicly owned, which meant Mr. Miller no longer headed a quoted company and therefore lacked a currency in his control with which to do deals, the analyst said.
The changes at Axa Financial did not end there. Michael Hegarty, 57, who was an Axa senior vice chairman and a chief operating officer (and like Mr. Miller a former executive of Chase Manhattan Corp. before his time at Axa) will leave after three years with the company. Axa said that Mr. Hegarty will "pursue other leadership opportunities."
In moving to Axa, Mr. Condron, 52, brings a financial planning background to the job, even though he joins the company from the banking universe. That is noteworthy, because under Mr. Miller Axa has shifted its focus toward financial planning and solutions rather than pushing products, so in a sense, Mr. Condron is going back to his roots.
Before joining Mellon in 1993 when it bought Boston Co., an asset management and trust company where he had been a vice chairman, Mr. Condron had founded and headed his own financial planning firm, which he later sold.
At Pittsburgh-based Mellon, some had thought that he might succeed departing chairman Frank Cahouet back in 1999. But that job went to Martin G. McGuinn, and Mr. Condron got the job of president.
On Wednesday, a Mellon spokesman said that it had no immediate plans to name a successor to the role of president of Mellon Financial. However, the company named Stephen E. Canter to succeed Mr. Condron as chairman of $149.5 billion asset Dreyfus.
Mr. Canter, who was president of Dreyfus, was also named to Mellon's executive management committee, along with Ronald P. O'Hanley, who heads up Mellon's institutional asset management division.
"We have a very deep bench of talent at Mellon," a spokesman said.
But banking analysts on this side of the Atlantic on Wednesday described Mr. Condron's departure as a major loss for the Pittsburgh banking company.
In a research note, Judah Kraushaar of Merrill Lynch & Co. wrote: "This comes as a big surprise and a significant loss to Mellon."
Mark Fitzgibbon, an analyst with Sandler O'Neill & Partners, agreed that Mr. Condron's departure came as a big surprise, "but I think Mellon will survive and thrive."
However, he added, "it didn't surprise me that Kip wanted a chance to run his own show."
