Salomon Brothers and Fidelity Investments form alliance; Equity offerings available to Fidelity's brokerage customers

Business Wire, Jan 17, 1997

BOSTON--(BUSINESS WIRE)-- Jan. 17, 1997--Salomon Brothers Inc and Fidelity Investments, two of the world's leading financial services companies, today announced a strategic alliance that allows Salomon Brothers to offer its corporate finance clients exclusive access to Fidelity's 6.1 million retail brokerage and mutual fund clients, and enables Fidelity Brokerage Services Inc. to participate in all equity transactions lead-managed by Salomon Brothers.

As part of this exclusive arrangement, Fidelity Brokerage Services Inc. will become the first discount broker offering access to new issue equity securities on a consistent basis to its retail clients. The arrangement also permits Fidelity Brokerage Services Inc. to distribute Salomon Brothers' highly ranked U.S. equity research to its retail customers.

The intent of this alliance is to capitalize on the highly complementary nature of the two firms' distinct distribution strengths in a manner that allows prospective issuers of equity capital a unique source of institutional and retail distribution worldwide.

"We are pleased to announce this partnership between Salomon Brothers and our retail brokerage group," said Edward C. Johnson 3d, chairman and chief executive officer of Fidelity Investments. "We believe it is important that our customers have access to initial public offerings, secondary offerings and equity research. This new relationship allows us to do that."

"Combining Salomon's institutional strength with Fidelity's retail client base will give companies a unique and powerful means of distributing their equity," states Deryck C. Maughan, chairman and chief executive officer of Salomon Brothers Inc.

Salomon Brothers' equity distribution is institutional, focusing on the largest pension funds, mutual funds, insurance companies, banks, and investment advisers. The partnership with Fidelity Brokerage Services Inc. allows Salomon Brothers' corporate finance clients to target a new universe of retail demand as evidenced by the role Fidelity played in the $574 million Class B Share offering for Berkshire Hathaway Inc., and its participation in the more recent $100 million-plus initial public stock offering for COLT Telecom Group plc. In the Berkshire Hathaway offering, Fidelity sold a significant percentage of the issue and its retail demand exceeded that of all other full service and discount brokers.

Fidelity Investments is the nation's largest mutual fund company and one of the leading providers of financial services. Fidelity offers investment management, retirement, brokerage and shareholder services directly to individuals and institutions and through financial intermediaries. The firm also is the No. 1 provider of 401(k) retirement savings plans, the second largest discount brokerage firm and the third largest provider of 403(b) retirement plans. At November 30, 1996, Fidelity had total managed assets of $500 billion.

Fidelity introduced its discount brokerage services in 1978, and in the last five years, has embarked upon an international expansion effort focusing initially on the United Kingdom and Continental Europe, and more recently Asia. The company has 82 investor centers in 69 cities.

Salomon Brothers is one of the largest underwriters and securities dealers in the world. The firm makes markets in securities and provides a broad range of underwriting, research and financial advisory services to governments, corporations, and institutional investors. Acknowledged for its financial product leadership and innovation, the firm publishes equity research on 1,850 corporations in more than 40 equity markets around the world.

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Brokerage services provided by Fidelity Brokerage Services, Inc. Member NYSE/SIPC

CONTACT: Andy Trincia

Fidelity Investments

(617) 563-5800

or

Robert Baker/Ann Crisp

Salomon Brothers

(212) 783-6299/6287