AMG to Make Investment in Third Avenue Management.

Business Editors

BOSTON--(BUSINESS WIRE)--May 22, 2002

Affiliated Managers Group, Inc. (NYSE: AMG), an asset management holding company, and Third Avenue Management (the "Company"), a newly formed entity to hold the businesses of EQSF Advisers, Inc., the investment adviser to the Third Avenue Funds, and MJ Whitman Advisers, Inc., an investment adviser to separately managed accounts, announced today that they have reached a definitive agreement for AMG to acquire a majority equity interest in the business of Third Avenue Management.

Third Avenue Management is a New York-based investment manager with approximately $5.6 billion in assets under management. The Company's asset management affiliates serve as the adviser to the Third Avenue family of no-load value mutual funds, and as the sub-adviser to non-proprietary mutual funds and annuities. The Company also manages separate accounts for high net worth individuals and institutions, both directly and through broker-referred programs. Third Avenue Management applies a disciplined value approach to investing in equities, real estate and corporate debt securities, using a comprehensive, bottom-up analysis to identify securities that are considered "safe and cheap," with a focus on creating value over the long term. Individual and institutional brokerage services are also provided through the Company's affiliated broker-dealer, MJ Whitman, Inc. ("MJ Whitman"), in which AMG is also acquiring a majority interest.

The Company was founded in 1974 by its Chairman, Martin J. Whitman, who, along with an experienced team of 12 investment professionals, manages the flagship $2.9 billion Third Avenue Value Fund, which is rated five stars by Morningstar, Inc. Mr. Whitman is a long-time advocate of investing in deep value equities and distressed situations. Along with Mr. Whitman, the investment team is led by Curtis R. Jensen, portfolio manager of the Third Avenue Small-Cap Value Fund, which is rated four stars by Morningstar, Michael Winer, who manages the Third Avenue Real Estate Value Fund, which holds a five star rating from Morningstar, and Amit Wadhwaney, who manages the recently formed Third Avenue International Value Fund. Third Avenue Management's President and Chief Operating Officer, David M. Barse, oversees the management and operations of the Company.

"We are pleased to welcome Third Avenue Management and its team to our group of Affiliates," said William J. Nutt, AMG's Chairman and Chief Executive Officer. "Third Avenue brings a consistent focus on fundamental analysis and disciplined value investing to all of the highly regarded Third Avenue Funds, with excellent results. By concentrating on `safe and cheap' investments, the Company has been able to deliver solid performance over both the near and long term, while maintaining low volatility."

Sean M. Healey, AMG's President and Chief Operating Officer, noted: "We are particularly impressed with the depth and quality of Third Avenue's management team, and their commitment to creating long-term value for investors. The Company has an impressive growth record, and with its proven investment approach and broad product offerings, Third Avenue is well positioned for continued growth." Mr. Healey continued, "Third Avenue Management is an excellent investment in its own right, and also adds to the diversity of our Affiliates by strengthening AMG's exposure to deep value investment management, and expanding AMG's diverse product offerings to include real estate and distressed debt investments."

Martin Whitman commented, "Our affiliation with AMG enables us to plan for the future while preserving the investment culture and autonomy of our firm. Through AMG's unique transaction structure, I am able to maintain my involvement in the firm, and at the same time to provide existing and future generations of management with meaningful equity ownership."

David Barse added, "By choosing to partner with AMG, we have been able to address our succession planning needs while maintaining important incentives for continued growth. We are pleased to join AMG's high quality group of Affiliates and, while we value the continued autonomy provided by AMG's investment structure, we also value the opportunity to benefit from AMG's Affiliate Development initiatives in the areas of distribution and business enhancement."

AMG will hold a 60% interest in a limited liability company which contains the business of Third Avenue Management and MJ Whitman. The remaining 40% of the business will be held by a broad group of key employees, including Messrs. Whitman, Barse, Jensen, Winer, Wadhwaney, and Michael Lehmann and Yang Lie, who are Senior Portfolio Managers with Third Avenue Management. Mr. Whitman and his family, as well as all of the members of the senior team at Third Avenue Management, intend to add to their significant holdings in the Third Avenue Funds by reinvesting a substantial portion of their proceeds from the transaction in the Funds. The terms of the transaction, which is expected to close upon receipt of customary approvals, were not disclosed.

Upon completion of the transaction, Third Avenue Management's business will remain unchanged. The firm's senior principals, including Messrs. Whitman, Barse, Jensen, Winer, Wadhwaney, Lehmann and Ms. Lie, have entered into long-term employment agreements with the Company.

AMG is an asset management company with equity investments in a diverse group of mid-sized investment management firms. AMG's strategy is to generate growth through the internal growth of its existing Affiliates, as well as through investments in new Affiliates. AMG's innovative transaction structure allows individual members of each Affiliate's management team to retain or receive significant direct equity ownership in their firm while maintaining operating autonomy. In addition, AMG provides centralized assistance to its Affiliates in strategic matters, marketing, distribution, product development and operations. AMG's affiliated investment management firms managed approximately $81 billion in assets at March 31, 2002, not including the pending investment in Third Avenue Management.

Certain matters discussed in this press release may constitute forward-looking statements within the meaning of the federal securities laws. Actual results and the timing of certain events could differ materially from those projected in or contemplated by the forward-looking statements due to a number of factors, including changes in the securities or financial markets or in general economic conditions, the availability of equity and debt financing, competition for acquisitions of interests in investment management firms, the ability to complete pending acquisitions, the investment performance of our Affiliates and their ability to effectively market their investment strategies, and other risks detailed from time to time in AMG's filings with the Securities and Exchange Commission. Reference is hereby made to the "Cautionary Statements" set forth in the Company's Form 10-K for the year ended December 31, 2001.

The source for Morningstar information is provided by Morningstar, Inc. at www.morningstar.com. Chicago-based Morningstar is the leading provider of mutual fund, stock, and variable-insurance investment information. An independent company, Morningstar does not own, operate, or hold any interest in mutual funds, stocks, or insurance products.

A teleconference will be held with AMG's management at 3:30 p.m. Eastern Time today. Parties interested in listening to the teleconference should dial 1-888-792-1075 (domestic calls) or 1-703-871-3027 (international calls) starting at 3:15 p.m. Eastern Time. Those wishing to listen to the teleconference should dial the appropriate number at least ten minutes before the call begins. The teleconference will be available for replay from approximately one hour after the conclusion of the call until 5:00 p.m. Eastern Time on Wednesday, May 29, 2002. To access the replay, please dial 1-800-696-1588 (domestic calls) or 1-303-804-1727 (international calls), pass code 1876037. The live call and the replay may also be accessed via the Web at www.amg.com.

For more information on Affiliated Managers Group, Inc., please visit AMG's Web site at www.amg.com.