Asset management companies may be increasingly driven toward consolidation following


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deal to buy


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asset management unit Barclays Global Investors, according to a report from bond research firm CreditSights.

CreditSights analysts say declines in both stock and bond markets mean fewer assets to manage, meaning money managers may look to increase revenues through economies of scale.

Citing several press reports that

Bank of New York Mellon

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was interested in buying BGI, CreditSights assumes it will now be looking around at other potential acquisitions.

Legg Mason

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ought to be at the top of Bank of New York's list, CreditSights argues, as it figures an acquisition could increase earnings by 15%.

State Street

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Alliance Bernstein


Federated Investors

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are other possibilities that would give Bank of New York's earnings a slight boost or hurt it only slightly in the short term, CreditSights writes.

Less attractive targets, though still possibilities, include

SEI Investments Co.

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Eaton Vance

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Janus Capital Group


, CreditSights writes.

Targets the analysts say "may not be appealing from a financial perspective," include

T. Rowe Price

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Franklin Resources

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, as they would cause considerable earnings dilution.