[UPDATE: Since this story was first run, a Legg Mason spokeswoman informed MFWire that "Trian has indicated to Legg Mason that it remains highly committed to its Legg Mason investment." The filing relates to a transfer of Legg Mason shares by Trian to an investor following the expiration of its lock-up period, and Nelson Peltz will continue to serve on the Legg Mason Board.]

On Mark Fetting's last day as Legg Mason [profile] CEO, activist shareholder and largest stakeholder Nelson Peltz has up and sold $12.9 million worth shares in Legg.

SEC filings Friday evening show Peltz sold off 1,822,946 shares in the company. The share price in the filing was $24.84; Legg shares closed at $24.68 as of market close today. Prior to this filing, Nelson Peltz owned 10.9 percent of Legg shares, making him Legg's largest shareholder; he now holds 9.54 percent.

Legg Mason has been the focus of much media attention lately with the announcement of CEO Mark Fetting's departure from the firm this coming Monday. Of speculation also had been the response by Peltz, who owns Trian Fund Management and is Legg's largest shareholder.

Peltz has also been in a standstill agreement with Legg that prohibits him from forming partnerships to accrue more voting interests, or forcing a sale or merger of any investment affiliates, all in exchange for a seat on the company board. The agreement expires on Nov. 30, meaning Peltz is free to buy shares as he pleases.

Peltz has not spoken publicly about Legg since the announcement about Fetting. But industry analysts speculate that Peltz may very well be the only one who knows what's fated for Legg Mason. Some even say that Legg may be "headed for a breakup".

Peltz first bought his stake in Legg in 2009, when the stock market and shares for financial services companies were down, in hope that the financial sector would recover. However, Legg has continued to flounder, and its stock continues to wallow at far below its $100 stock price in mid-2007. The firm has also suffered negative flows for the past 19 quarters straight. It also lost $9.5 million, or 7 cents per diluted share, in its first quarter of fiscal year 2013.

In late June, MFWire had covered the news that Trian was turning its attention away from Legg to Lazard. Lazard is primarily an investment bank but also advises a family of mutual funds.

Coverage of Peltz's acquisitions of Legg shares in 2009 can be found here and here. Peltz first became Legg's largest shareholder in late December 2009. 

Correction: The MFWire has published a follow-up story to this article.

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