Affiliated Managers Group, Inc.
(Exact name of registrant as specified in its charter)

600 Hale Street, Prides Crossing, Massachusetts 01965
(Address of principal executive offices)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No o (Registrant is not subject to the requirements of Rule 405 of Regulation S-T at this time).

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No ý

There were ~~42,053,861~~44,548,728 shares of the registrant's common stock outstanding on ~~November 5, 2009.~~May 6, 2010.

AFFILIATED MANAGERS GROUP, INC.

CONSOLIDATED STATEMENTS OF INCOME

(dollars in thousands, except per share data)

(unaudited)

			For the Three Months Ended September 30,						For the Nine Months Ended September 30,							For the Three Months Ended March 31,

			2008			2009			2008			2009				2009			2010
Revenue	Revenue		$	290,824		$	217,461		$	934,822		$	597,182		Revenue	$	178,475		$	251,021
Operating expenses:	Operating expenses:														Operating expenses:
	Compensation and related expenses			123,703			105,237			415,605			292,770		Compensation and related expenses		84,160			119,229
	Selling, general and administrative			53,482			28,294			154,510			92,958		Selling, general and administrative		32,507			46,059
	Amortization of intangible assets			8,562			8,293			25,463			24,430		Amortization of intangible assets		8,094			8,937
	Depreciation and other amortization			2,996			3,167			8,672			9,649		Depreciation and other amortization		3,239			3,026
	Other operating expenses			4,898			10,865			15,361			21,351		Other operating expenses		5,750			6,053

				193,641			155,856			619,611			441,158				133,750			183,304

Operating income	Operating income			97,183			61,605			315,211			156,024		Operating income		44,725			67,717

Non-operating (income) and expenses:	Non-operating (income) and expenses:														Non-operating (income) and expenses:
	Investment and other (income) loss			3,865			(6,614	)		5,378			(13,564	)	Investment and other (income) loss		241			(2,822	)
	Income from equity method investments			(13,177	)		(8,203	)		(40,579	)		(21,970	)	Income from equity method investments		(6,416	)		(9,147	)
	Investment (income) loss from Affiliate														Investment (income) loss from investments in partnerships		3,795			(4,091	)
		investments in partnerships		22,841			(14,914	)		31,771			(26,065	)	Interest expense		19,948			19,851
	Interest expense			19,883			19,540			59,747			58,681
																	17,568			3,791
				33,412			(10,191	)		56,317			(2,918	)

Income before income taxes	Income before income taxes			63,771			71,796			258,894			158,942		Income before income taxes		27,157			63,926
Income taxes—current	Income taxes—current			6,212			63			31,713			(9,108	)	Income taxes—current		(8,045	)		2,507
Income taxes—intangible-related deferred	Income taxes—intangible-related deferred			14,093			6,181			32,154			25,296		Income taxes—intangible-related deferred		9,571			10,740
Income taxes—other deferred	Income taxes—other deferred			4,078			(2,308	)		(806	)		(4,595	)	Income taxes—other deferred		2,391			(2,082	)

Net income	Net income			39,388			67,860			195,833			147,349		Net income		23,240			52,761
Net income (non-controlling interests)				(44,914	)		(35,459	)		(143,738	)		(87,008	)
Net (income) loss (non-controlling interests in partnerships)				21,997			(14,632	)		30,234			(25,468	)
															Net income (non-controlling interests)		(20,878	)		(31,285	)
															Net (income) loss (non-controlling interests in partnerships)		3,763			(4,014	)

Net Income (controlling interest)	Net Income (controlling interest)		$	16,471		$	17,769		$	82,329		$	34,873		Net Income (controlling interest)	$	6,125		$	17,462

Average shares outstanding—basic	Average shares outstanding—basic			39,522,159			41,854,249			37,770,720			41,115,819		Average shares outstanding—basic		40,022,423			42,360,311
Average shares outstanding—diluted	Average shares outstanding—diluted			42,063,538			44,267,107			41,759,696			42,835,258		Average shares outstanding—diluted		41,082,130			45,421,716
Earnings per share—basic	Earnings per share—basic		$	0.42		$	0.42		$	2.18		$	0.85		Earnings per share—basic	$	0.15		$	0.41
Earnings per share—diluted	Earnings per share—diluted		$	0.39		$	0.40		$	2.02		$	0.82		Earnings per share—diluted	$	0.15		$	0.38
Supplemental disclosure of total comprehensive income:	Supplemental disclosure of total comprehensive income:														Supplemental disclosure of total comprehensive income:
Net income	Net income		$	39,388		$	67,860		$	195,833		$	147,349		Net income	$	23,240		$	52,761
Other comprehensive income (loss)	Other comprehensive income (loss)			(14,877	)		25,792			(17,325	)		40,596		Other comprehensive income (loss)		(9,872	)		25,392

Comprehensive income	Comprehensive income			24,511			93,652			178,508			187,945		Comprehensive income		13,368			78,153
Comprehensive income (non-controlling interests)	Comprehensive income (non-controlling interests)			(22,917	)		(50,091	)		(113,504	)		(112,476	)	Comprehensive income (non-controlling interests)		(17,115	)		(35,299	)

Comprehensive income (controlling interest)			$	1,594		$	43,561		$	65,004		$	75,469
Comprehensive income (loss) (controlling interest)															Comprehensive income (loss) (controlling interest)	$	(3,747	)	$	42,854

The accompanying notes are an integral part of the Consolidated Financial Statements.

AFFILIATED MANAGERS GROUP, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands)

(unaudited)

			December 31, 2008			September 30, 2009					December 31, 2009			March 31, 2010

Assets	Assets								Assets
Current assets:	Current assets:								Current assets:
									Cash and cash equivalents		$	259,487		$	203,751
	Cash and cash equivalents		$	396,431		$	225,250		Investment advisory fees receivable			140,118			157,502
	Investment advisory fees receivable			131,099			132,160		Investments in partnerships			93,809			97,304
	Affiliate investments in partnerships			68,789			95,587		Investments in marketable securities			56,690			80,814
	Affiliate investments in marketable securities			10,399			16,574		Unsettled fund share receivables			—			154,740
	Prepaid expenses and other current assets			23,968			24,975		Prepaid expenses and other current assets			35,478			22,119

		Total current assets		630,686			494,546			Total current assets		585,582			716,230
Fixed assets, net	Fixed assets, net			71,845			64,874		Fixed assets, net			62,402			65,309
Equity investments in Affiliates	Equity investments in Affiliates			678,887			662,854		Equity investments in Affiliates			658,332			644,876
Acquired client relationships, net	Acquired client relationships, net			491,408			585,604		Acquired client relationships, net			571,573			803,250
Goodwill	Goodwill			1,243,583			1,406,615		Goodwill			1,413,217			1,521,222
Other assets	Other assets			96,291			110,043		Other assets			99,800			114,984

		Total assets	$	3,212,700		$	3,324,536			Total assets	$	3,390,906		$	3,865,871

Liabilities and Stockholders' Equity	Liabilities and Stockholders' Equity								Liabilities and Stockholders' Equity
Current liabilities:	Current liabilities:								Current liabilities:
	Accounts payable and accrued liabilities		$	183,794		$	130,201		Accounts payable and accrued liabilities		$	117,227		$	126,960
	Payables to related party			26,187			87,847		Unsettled fund share payables			—			159,039
									Payables to related party			109,888			18,314
		Total current liabilities		209,981			218,048
Senior bank debt				233,514			—
										Total current liabilities		227,115			304,313
Senior debt									Senior debt			—			170,000
Senior convertible securities	Senior convertible securities			445,535			454,116		Senior convertible securities			456,976			460,137
Junior convertible trust preferred securities	Junior convertible trust preferred securities			505,034			506,756		Junior convertible trust preferred securities			507,358			507,965
Deferred income taxes	Deferred income taxes			319,491			323,308		Deferred income taxes			322,671			393,263
Other long-term liabilities	Other long-term liabilities			30,414			26,329		Other long-term liabilities			26,066			123,655

		Total liabilities		1,743,969			1,528,557			Total liabilities		1,540,186			1,959,333
Redeemable non-controlling interests	Redeemable non-controlling interests			297,733			362,833		Redeemable non-controlling interests			368,999			368,702
Equity:	Equity:								Equity:
	Common stock			458			458		Common stock			458			458
	Additional paid-in capital			817,713			671,588		Additional paid-in capital			612,091			594,842
	Accumulated other comprehensive income (loss)			(4,081	)		36,515		Accumulated other comprehensive income			45,958			71,350
	Retained earnings			813,664			848,537		Retained earnings			873,137			890,599

				1,627,754			1,557,098					1,531,644			1,557,249
	Less: treasury stock, at cost			(702,953	)		(452,458	)	Less: treasury stock, at cost			(421,954	)		(416,588	)

		Total stockholders' equity		924,801			1,104,640			Total stockholders' equity		1,109,690			1,140,661
Non-controlling interests	Non-controlling interests			180,732			236,517		Non-controlling interests			281,946			303,674
Non-controlling interests in partnerships	Non-controlling interests in partnerships			65,465			91,989		Non-controlling interests in partnerships			90,085			93,501

		Total equity		1,170,998			1,433,146			Total equity		1,481,721			1,537,836

		Total liabilities and equity	$	3,212,700		$	3,324,536			Total liabilities and equity	$	3,390,906		$	3,865,871

The accompanying notes are an integral part of the Consolidated Financial Statements.

AFFILIATED MANAGERS GROUP, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(dollars in thousands)

(unaudited)

	Total Stockholders' Equity																							Total Stockholders' Equity

	Common Stock		Additional Paid-In Capital			Accumulated Other Comprehensive Income (Loss)			Retained Earnings		Treasury Shares at Cost			Non- controlling interests			Non- controlling interests in partnerships			Total Equity				Common Stock		Additional Paid-In Capital			Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Treasury Shares at Cost			Non- controlling interests			Non- controlling interests in partnerships			Total Equity
December 31, 2008	$	458	$	817,713		$	(4,081	)	$	813,664	$	(702,953	)	$	180,732		$	65,465		$	1,170,998
December 31, 2009																							December 31, 2009	$	458	$	612,091		$	45,958	$	873,137	$	(421,954	)	$	281,946		$	90,085		$	1,481,721
Stock issued under option and other incentive plans		—		(52,168	)		—			—		80,859			—			—			28,691		Stock issued under option and other incentive plans		—		(3,915	)		—		—		5,357			—			—			1,442
Tax benefit of option exercises		—		7,010			—			—		—			—			—			7,010		Tax benefit of option exercises		—		635			—		—		—			—			—			635
Issuance costs		—		(575	)		—			—		—			—			—			(575	)	Issuance costs		—		(82	)		—		—		—			—			—			(82	)
Settlement of forward equity sale agreement		—		(25,378	)		—			—		169,636			—			—			144,258
Changes in Affiliate equity																							Changes in Affiliate equity		—		(19,476	)		—		—		—			(1,573	)		—			(21,049	)
Conversion of zero coupon convertible notes																							Conversion of zero coupon convertible notes		—		1			—		—		9			—			—			10
Share-based payment arrangements		—		11,764			—			—		—			—			—			11,764		Share-based payment arrangements		—		5,588			—		—		—			—			—			5,588
Changes in Affiliate equity		—		(86,778	)		—			—		—			8,946						(77,832	)
Distributions to non-controlling interests		—		—			—			—		—			(102,087	)		—			(102,087	)
Distributions to non-controlling																							Distributions to non-controlling
																							interests		—		—			—		—		—			(66,681	)		—			(66,681	)
Investments in Affiliates		—		—			—			—		—			61,918			2,514			64,432		Investments in Affiliates		—					—		—		—			58,697			—			58,697
Other changes in non-controlling interests in partnerships																							Other changes in non-controlling interests in partnerships		—		—			—		—		—			—			(598	)		(598	)
Net Income		—		—			—			34,873		—			87,008			25,468			147,349		Net Income		—		—			—		17,462		—			31,285			4,014			52,761
Other changes in non-controlling interests in partnerships, net		—		—			—			—		—			—			(1,458	)		(1,458	)
Other comprehensive income		—		—			40,596			—		—			—			—			40,596		Other comprehensive income		—		—			25,392		—		—			—			—			25,392

September 30, 2009	$	458	$	671,588		$	36,515		$	848,537	$	(452,458	)	$	236,517		$	91,989		$	1,433,146
March 31, 2010																							March 31, 2010	$	458	$	594,842		$	71,350	$	890,599	$	(416,588	)	$	303,674		$	93,501		$	1,537,836

The accompanying notes are an integral part of the Consolidated Financial Statements.

AFFILIATED MANAGERS GROUP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

			For the Three Months Ended September 30,						For the Nine Months Ended September 30,								For the Three Months Ended March 31,

			2008			2009			2008			2009					2009			2010
Cash flow from operating activities:	Cash flow from operating activities:														Cash flow from operating activities:
	Net Income		$	39,388		$	67,860		$	195,833		$	147,349		Net Income		$	23,240		$	52,761
Adjustments to reconcile Net Income to net cash flow from operating activities:	Adjustments to reconcile Net Income to net cash flow from operating activities:														Adjustments to reconcile Net Income to net cash flow from operating activities:
	Amortization of intangible assets			8,562			8,293			25,463			24,430		Amortization of intangible assets			8,094			8,937
	Amortization of issuance costs			1,195			1,843			2,404			5,479		Amortization of issuance costs			1,795			1,847
	Depreciation and other amortization			2,996			3,167			8,672			9,649		Depreciation and other amortization			3,239			3,026
	Deferred income tax provision			18,171			3,873			31,348			20,701		Deferred income tax provision			11,962			8,658
	Accretion of interest			2,380			3,448			5,240			10,303		Accretion of interest			3,431			3,778
	Income from equity method investments, net of amortization			(13,177	)		(8,202	)		(40,579	)		(21,970	)	Income from equity method investments, net of amortization			(6,416	)		(9,147	)
	Distributions received from equity method investments			15,960			13,725			65,407			42,545		Distributions received from equity method investments			18,941			23,187
	Tax benefit from exercise of stock options			488			1,715			2,767			3,174		Tax benefit from exercise of stock options			—			274
	Stock option expense			3,802			2,560			11,202			5,695		Stock option expense			1,177			3,644
	Affiliate equity expense			3,144			3,150			10,754			9,869		Affiliate equity expense			3,250			3,368
	Other adjustments			30,034			(14,605	)		36,314			(33,302	)	Other adjustments			2,550			(3,975	)
Changes in assets and liabilities:	Changes in assets and liabilities:														Changes in assets and liabilities:
															(Increase) decrease in investment advisory fees receivable			29,342			(938	)
															Decrease in investments in partnerships			979			283
	(Increase) decrease in investment advisory fees receivable			8,480			(17,051	)		67,404			845		Decrease in prepaids and other current assets			257			10,729
	(Increase) decrease in Affiliate investments in partnerships			3,866			—			(2,790	)		331		Increase in unsettled fund shares receivable			—			(98,711	)
	(Increase) decrease in prepaids and other current assets			5,442			(811	)		23,822			(10,024	)	(Increase) decrease in other assets			1,830			(11,112	)
	(Increase) decrease in other assets			433			(46	)		9,544			2,869		Decrease in accounts payable, accrued liabilities and other long-term liabilities			(87,980	)		(36,942	)
	Increase (decrease) in accounts payable, accrued liabilities and other long-term liabilities			56,111			11,243			(22,749	)		(49,876	)	Increase in unsettled fund shares payable			—			108,354

		Cash flow from operating activities		187,275			80,162			430,056			168,067			Cash flow from operating activities		15,691			68,021

Cash flow used in investing activities:	Cash flow used in investing activities:														Cash flow used in investing activities:
	Investments in Affiliates			—			(137,860	)		(60,910	)		(139,271	)	Investments in Affiliates			—			(127,668	)
	Purchase of fixed assets			(2,950	)		(438	)		(8,091	)		(1,653	)	Purchase of fixed assets			(552	)		(1,105	)
	Purchase of investment securities			(9,191	)		—			(32,635	)		(11,746	)	Purchase of investment securities			(8,836	)		(14,919	)
	Sale of investment securities			9,144			1,584			24,146			7,303		Sale of investment securities			5,720			11,784

		Cash flow used in investing activities		(2,997	)		(136,714	)		(77,490	)		(145,367	)		Cash flow used in investing activities		(3,668	)		(131,908	)

Cash flow from (used in) financing activities:	Cash flow from (used in) financing activities:														Cash flow from (used in) financing activities:
	Borrowings of senior bank debt			65,000			—			366,000			—		Borrowings of senior bank debt			—			235,000
	Repayments of senior bank debt			(398,000	)		—			(645,500	)		(233,514	)	Repayments of senior bank debt			(233,514	)		(65,000	)
	Issuance of senior convertible notes			460,000			—			460,000			—		Issuance of common stock			—			2,455
	Settlement of convertible securities			—			—			(208,730	)		—		Issuance costs			(921	)		(82	)
	Issuance of common stock			5,980			18,139			238,781			29,760		Excess tax benefit from exercise of stock options			—			361
	Repurchase of common stock			(29,796	)		—			(54,550	)		—		Settlement of forward equity sale agreement			144,258			—
	Issuance costs			(26,223	)		(288	)		(28,164	)		(1,209	)	Note payments			(1,547	)		(25,371	)
	Excess tax benefit from exercise of stock options			1,294			2,750			11,101			3,836		Distributions to non-controlling interests			(61,619	)		(36,913	)
	Settlement of derivative contracts			—			—			8,154			—		Affiliate equity issuances and repurchases			(16,385	)		(102,639	)
	Settlement of forward equity sale agreement			—			—			—			144,258		Redemptions of non-controlling interests in partnerships			(979	)		(284	)
	Note payments			(563	)		7,196			1,263			2,718
	Distributions to non-controlling interests			(45,933	)		(14,962	)		(231,019	)		(102,087	)		Cash flow from (used in) financing activities		(170,707	)		7,527
	Repurchases of Affiliate equity			(3,141	)		(7,502	)		(89,822	)		(40,308	)
	Subscriptions (redemptions) of Non-controlling interests in partnerships			(1,667	)		—			1,989			(471	)

		Cash flow from (used in) financing activities		26,951			5,333			(170,497	)		(197,017	)

Effect of foreign exchange rate changes on cash and cash equivalents	Effect of foreign exchange rate changes on cash and cash equivalents			(1,456	)		2,100			(2,013	)		3,136		Effect of foreign exchange rate changes on cash and cash equivalents			(456	)		624
Net increase (decrease) in cash and cash equivalents				209,773			(49,119	)		180,056			(171,181	)
Net decrease in cash and cash equivalents															Net decrease in cash and cash equivalents			(159,140	)		(55,736	)
Cash and cash equivalents at beginning of period	Cash and cash equivalents at beginning of period			193,237			274,369			222,954			396,431		Cash and cash equivalents at beginning of period			396,431			259,487

Cash and cash equivalents at end of period	Cash and cash equivalents at end of period		$	403,010		$	225,250		$	403,010		$	225,250		Cash and cash equivalents at end of period		$	237,291		$	203,751

Supplemental disclosure of non-cash financing activities:	Supplemental disclosure of non-cash financing activities:														Supplemental disclosure of non-cash financing activities:
	Stock issued for conversion of floating rate senior convertible securities			—			—			299,970			—		Notes received for Affiliate equity sales		$	3,467		$	5,749
	Stock issued in settlement of mandatory convertible securities			—			—			93,750			—		Payables recorded for Affiliate equity purchases			—			15,284
															Payables recorded under contingent payment arrangements			—			48,967

The accompanying notes are an integral part of the Consolidated Financial Statements.

The consolidated financial statements of Affiliated Managers Group, Inc. ("~~Company"~~AMG" or ~~"AMG"~~the "Company") have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. The year-end condensed balance sheet data was derived from audited financial statements, but does not include all of the disclosures required by accounting principles generally accepted in the United States of America. In the opinion of management, all adjustments considered necessary for a fair statement of the results have been included. All intercompany balances and transactions have been eliminated. All dollar amounts in these notes (except information that is presented on a per share, per security, per note or per contract basis) are stated in thousands, unless otherwise indicated. Certain reclassifications have been made to the prior period's financial statements to conform to the current period's presentation. Operating results for interim periods are not necessarily indicative of the results that may be expected for any other period or for the full year. The Company's Annual Report on Form 10-K (as amended, the "Annual Report on Form 10-K") for the fiscal year ended December 31, ~~2008~~2009 includes additional information about AMG, its operations, its financial position and its accounting policies, and should be read in conjunction with this Quarterly Report on Form 10-Q. ~~Subsequent events and transactions have been evaluated for potential recognition or disclosure through November 9, 2009, the day the financial statements were issued.~~

~~The Company adopted several accounting standards in 2009 ("the 2009 accounting changes") that have been retrospectively applied to prior periods.~~

The Company is now required to bifurcate certain of its convertible debt securities into their theoretical debt and equity components. The Company accretes (as interest expense) the debt components to their principal amounts over the expected life of the debt. As a result, the Company has reported incremental non-cash interest of approximately $2,128 and $3,388 for the three months ended September 30, 2008 and 2009, respectively.

The Company is now required to expense professional fees incurred in connection with a business combination. The Company retrospectively applied this accounting change to acquisition-related professional fees that were deferred as of December 31, 2008, and, accordingly, the Company's 2008 net income was reduced by $5,902 ($3,445 and $4,304 attributable to the three and nine months ended September 30, 2008, respectively). The other provisions of this new guidance will be applied to future acquisitions (see Note 17).

The Company is now required to change the presentation of non-controlling interests (previously known as minority interests). Net income (non-controlling interest), which was previously reported as Minority interest (and reduced net income) on the Company's Consolidated Statements of Income, is now included in Net income. The accumulated capital of non-controlling interests, which was previously reported as Minority interest on the Company's Consolidated Balance Sheets, is now reported in Equity. Payments to non-controlling interests, profit distributions and repurchases of Affiliate equity, are now classified as financing activities on the Statements of Cash Flows (previously reported as operating and investing activities, respectively).

Guidance on the reporting of equity securities that are subject to mandatory redemption requirements or whose redemption is outside the control of the issuer now requires the Company to present the redemption value of its Affiliate equity on its Consolidated Balance Sheets (referred to as "Redeemable non-controlling interests"). Adjustments to Redeemable non-controlling interests are recorded to stockholders' equity.

In the fourth quarter of 2007, the Company entered into an amended and restated senior credit facility (the "Facility"). During the third quarter of 2008, the Company increased its borrowing capacity to $1,010,000, comprised of a $770,000 revolving credit facility (the "Revolver") and a $240,000 term loan (the "Term Loan"). In the first quarter of 2009, the Company repaid the outstanding balance of the Term Loan ($233,514); the capacity under the Revolver remains at $770,000. The Company pays interest on any outstanding obligations at specified rates (based either on the Eurodollar rate or the prime rate as in effect from time to time) that vary depending on the Company's credit rating. Subject to the agreement of lenders to provide additional commitments, the Company has the option to increase the Facility by up to an additional $175,000.

The Revolver, which will mature in February 2012, ~~and~~ contains financial covenants with respect to leverage and interest coverage. The Facility also contains customary affirmative and negative covenants, including limitations on indebtedness, liens, cash dividends and fundamental corporate changes. Borrowings under the Facility are collateralized by pledges of the substantial majority of capital stock or other equity interests owned by the Company. ~~The~~At March 31, 2010, the Company had no$170,000 of outstanding borrowings ~~at September 30, 2009.~~under the Revolver.

~~Following the Company's adoption of the 2009 accounting changes, the~~The carrying values of the senior convertible securities are as follows:

	December 31, 2008				September 30, 2009				December 31, 2009				March 31, 2010

	Carrying Value		Principal amount at maturity		Carrying Value		Principal amount at maturity		Carrying Value		Principal amount at maturity		Carrying Value		Principal amount at maturity
2008 senior convertible notes	$	398,389	$	460,000	$	406,793	$	460,000	$	409,594	$	460,000	$	412,725	$	460,000
Zero coupon senior convertible notes		47,146		50,135		47,323		50,135		47,382		50,135		47,412		50,125

Total senior convertible securities	$	445,535	$	510,135	$	454,116	$	510,135	$	456,976	$	510,135	$	460,137	$	510,125

In August 2008, the Company issued $460,000 of senior convertible notes due 2038 ("2008 senior convertible notes"). The 2008 senior convertible notes bear interest at 3.95%, payable semi-annually in cash. The Company is accreting the carrying value to the principal amount at maturity using an interest rate of 7.4% (over its expected life of five years)~~, resulting in incremental interest expense for 2009 of approximately $11,205.~~. Each security is convertible into 7.959 shares of the Company's common stock (at an initial conversion price of $125.65) upon the occurrence of certain ~~events.~~events, as follows: (i) during any fiscal quarter, if the closing price of the Company's common stock, as measured over a specified time period during the preceding fiscal quarter, is equal to or greater than 130% of the conversion price of the notes on the last day of such preceding fiscal quarter; (ii) during a certain window of time, if the trading price per $1,000 principal amount of the notes for each day during a specified period is less than 98% of the product of the last reported sale price of the Company's common stock and the conversion rate of the notes on such day; (iii) upon the occurrence of specified corporate transactions; (iv) after the notes have been called for redemption; and (v) anytime after February 15, 2038. Upon conversion, the Company may elect to pay cash, or deliver shares of its common stock, or ~~some~~a combination thereof. The holders of the 2008 senior convertible notes may require the Company to repurchase the notes in August of 2013, 2018, 2023, 2028 and 2033. The Company may redeem the notes for cash (subject to the ~~holders~~holders' right to convert) at any time on or after August 15, 2013.

The 2008 senior convertible notes are considered contingent payment debt instruments under federal income tax regulations. These regulations require the Company to deduct interest in an amount greater than its reported interest expense, which will result in annual deferred tax liabilities of approximately ~~$10,220.~~$11,200. These deferred tax liabilities will be reclassified directly to stockholders' equity if the Company's common stock is trading above certain thresholds at the time of the conversion of the notes.

In 2001, the Company issued $251,000 principal amount at maturity of zero coupon senior convertible notes due 2021 ("zero coupon convertible notes"), with each note issued at 90.50% of such principal amount and accreting at a rate of 0.50% per ~~year (these securities were not affected by the 2009 accounting changes).~~year. As of ~~September 30, 2009, $50,135~~March 31, 2010, $50,125 principal amount at maturity remains outstanding. Each security is convertible into 17.429 shares of the Company's common stock (at a current base conversion price of ~~$54.16)~~$54.28) upon the occurrence of certain events, ~~including the following:~~as follows: (i) during any fiscal quarter, if the closing price of a share of the Company's common stock, as measured over a specified time period during the preceding fiscal quarter, is ~~more~~greater than a specified conversion price ~~over certain periods~~ (initially $62.36 and increasing incrementally at the end of each calendar quarter to $63.08 in April 2021); (ii) if the credit rating assigned by Standard & Poor's to the securities is below BB-; or (iii) if the Company calls the securities for ~~redemption.~~redemption and (iv) upon the occurrence of specified corporate transactions. The holders may require the Company to repurchase the securities at their accreted value in May 2011 and 2016. If the holders exercise this option in the future, the Company may elect to repurchase the securities with cash, shares of its common stock or ~~some~~a combination thereof. The Company has the option to redeem the securities for cash at their accreted value. ~~Under the terms of the indenture governing the zero coupon convertible notes, a holder may convert such security into common stock by following the conversion procedures in the indenture.~~ Subject to changes in the price of the Company's common stock, the zero coupon convertible notes may not be convertible in certain future periods.

~~Following the Company's adoption of the 2009 accounting changes, the~~The carrying values of the junior convertible trust preferred securities are as follows:

	December 31, 2008				September 30, 2009				December 31, 2009				March 31, 2010

	Carrying Value		Principal amount at maturity		Carrying Value		Principal amount at maturity		Carrying Value		Principal amount at maturity		Carrying Value		Principal amount at maturity
2006 junior convertible trust preferred securities	$	211,429	$	300,000	$	212,196	$	300,000	$	212,466	$	300,000	$	212,734	$	300,000
2007 junior convertible trust preferred securities		293,605		430,820		294,560		430,820		294,892		430,820		295,231		430,820

Total junior convertible securities	$	505,034	$	730,820	$	506,756	$	730,820	$	507,358	$	730,820	$	507,965	$	730,820

In 2006, the Company issued $300,000 of junior subordinated convertible debentures due 2036 to a wholly-owned trust simultaneous with the issuance, by the trust, of $291,000 of convertible trust preferred securities to investors. The junior subordinated convertible debentures and convertible trust preferred securities (together, the "2006 junior convertible trust preferred securities") have substantially the same terms.

The 2006 junior convertible trust preferred securities bear interest at a rate of 5.1% per annum, payable quarterly in cash. The Company is accreting the carrying value to the principal amount at

maturity using an interest rate of 7.5% (over its expected life of 30 years). ~~The incremental interest expense for 2009 is expected to be $1,036.~~ Each $50 security is convertible, at any time, into 0.333 shares of the Company's common stock, which represents a conversion price of $150 per share (or a 48% premium to the then prevailing share price of $101.45). Upon conversion, ~~investors~~holders will receive cash or shares of the Company's common stock (or a combination of cash and common stock) at the election of the Company. The 2006 junior convertible trust preferred securities may not be redeemed by the Company prior to April 15, 2011. On or after April 15, 2011, they may be redeemed if the closing price of the Company's common stock exceeds $195 per share for a specified period of time. The trust's only assets are the junior convertible subordinated debentures. To the extent that the trust has available funds, the Company is obligated to ensure that holders of the 2006 junior convertible trust preferred securities receive all payments due from the trust.

In October 2007, the Company issued an additional $500,000 of junior subordinated convertible debentures which are due 2037 to a wholly-owned trust simultaneous with the issuance, by the trust, of $500,000 of convertible trust preferred securities to investors. The junior subordinated convertible debentures and convertible trust preferred securities (together, the "2007 junior convertible trust preferred securities") have substantially the same terms. In the fourth quarter of 2008, the Company repurchased $69,180 aggregate principal amount of the 2007 junior convertible trust preferred securities. Following this repurchase, these securities were cancelled and retired.

The 2007 junior convertible trust preferred securities bear interest at 5.15% per annum, payable quarterly in cash. The Company is accreting the discounted amount to the principal amount at maturity using an interest rate of 8.0% (over its expected life of 30 years). ~~The incremental interest expense for 2009 is expected to be $1,288.~~ Each $50 security is convertible, at any time, into 0.25 shares of the Company's common stock, which represents a conversion price of $200 per share (or a 53% premium to the then prevailing share price of $130.77). Upon conversion, ~~investors~~holders will receive cash or shares of the Company's common stock (or a combination of cash and common stock) at the election of the Company. The 2007 junior convertible trust preferred securities may not be redeemed by the Company prior to October 15, 2012. On or after October 15, 2012, they may be redeemed if the closing price of the Company's common stock exceeds $260 per share for a specified period of time. The trust's only assets are the 2007 junior convertible subordinated debentures. To the extent that the trust has available funds, the Company is obligated to ensure that holders of the 2007 junior convertible trust preferred securities receive all payments due from the trust.

The 2006 and 2007 junior convertible trust preferred securities are considered contingent payment debt instruments under federal income tax regulations. These regulations require the Company to deduct interest in an amount greater than its reported interest expense, which will result in annual deferred tax liabilities of approximately ~~$8,800.~~$9,500. These deferred tax liabilities will be reclassified directly to stockholders' equity if the Company's common stock is trading above certain thresholds at the time of the conversion of the notes.

~~In May 2008, the~~The Company has entered into athree forward equity sale ~~agreement~~agreements with a major securities ~~firm~~firms to sell ~~up to $200,000~~shares of its common stock ~~(the "May 2008 Agreement"), with the timing of sales in the Company's discretion.~~(up to $200,000 under each agreement). Under the terms of ~~the May 2008 Agreement,~~these agreements, the Company can settle forward sales at any time prior to ~~March~~December 31, 2010 by issuing shares in exchange for ~~cash. Alternatively,~~cash or, at the ~~Company may choose to settle forward sales~~Company's option, by settling on a net stock or cash basis. ~~The~~As of March 31, 2010, the Company has ~~sold all $200,000 under the May 2008 Agreement~~$349,330 of forward sales that remain unsettled at a weighted average ~~exercise~~ price of ~~$65.41 and has~~

~~settled approximately $144,000 of these forward sales through the issuance of approximately 1.8 million shares.~~$57.54.

~~In May 2009,~~A summary of the ~~Company entered into a second~~Company's forward equity sale agreement to sell up to $200,000 of its common stock (the "May 2009 Agreement"). The Company has sold all $200,000 under the May 2009 Agreement at a weighted average exercise price of $57.27, but has not yet elected to settle these forward sales. Asagreements is the case in the May 2008 Agreement, the Company may choose to settle forward sales at any time by issuing shares in exchange for cash, or it may settle forward sales on a net stock or cash basis (prior to August 1, 2010).as follows:

~~The Company's consolidated income taxes represent taxes on Net Income (controlling interest) as net income attributable to non-controlling interests is not taxed at the corporate level.~~ A summary of the provision for income taxes is as follows:

		For the Three Months Ended September 30,						For the Nine Months Ended September 30,							For the Three Months Ended March 31,

		2008			2009			2008			2009				2009			2010
Current:	Current:													Current:
	Federal	$	3,182		$	(3,418	)	$	18,334		$	(18,043	)	Federal	$	(9,985	)	$	(748	)
	State		607			859			3,031			2,534		State		363			368
	Foreign		2,423			2,622			10,348			6,401		Foreign		1,577			2,887

Total Current	Total Current		6,212			63			31,713			(9,108	)	Total Current		(8,045	)		2,507

Deferred:	Deferred:													Deferred:
	Federal		12,052			3,948			26,237			22,404		Federal	$	11,008		$	7,877
	State		7,001			451			7,811			(440	)	State		1,258			1,273
	Foreign		(882	)		(526	)		(2,700	)		(1,263	)	Foreign		(304	)		(492	)

Total Deferred	Total Deferred		18,171			3,873			31,348			20,701		Total Deferred		11,962			8,658

Provision for Income Taxes	Provision for Income Taxes	$	24,383		$	3,936		$	63,061		$	11,593		Provision for Income Taxes	$	3,917		$	11,165

Effective Tax Rate⁽¹⁾	Effective Tax Rate⁽¹⁾		59.7	%		18.1	%		43.4	%		24.9	%	Effective Tax Rate⁽¹⁾		39.0	%		39.0	%

During the quarter ended September 30, 2008, the state of Massachusetts enacted legislation that required combined tax reporting for the Company and all its subsidiaries beginning in 2009. The tax provision for the quarter ended September 30, 2008 includes a one-time expense for the revaluation of the Company's deferred taxes of $8,870 for the new legislation. This adjustment increased the Company's effective tax rate for the three and nine months ended September 30, 2008.

During the quarter ended September 30, 2009, the Company realized $6,111 of tax benefits from the restructuring of relationships with certain Affiliates, reducing the Company's effective tax rate for the period. For the nine months ended September 30, 2009, the Company's effective tax rate has been reduced by the benefits described above and a $3,000 reduction in valuation allowances on state net operating losses.

December 31,
2008 September 30,
2009
Deferred assets (liabilities):

Intangible asset amortization
$ (185,376 ) $ (187,485 )

Convertible securities interest
(124,805 ) (135,591 )

Non-deductible intangible amortization
(18,277 ) (19,853 )

State net operating loss carryforwards
31,259 29,495

Deferred compensation
4,643 5,620

Fixed asset depreciation
(3,626 ) (3,644 )

Accrued expenses
4,739 4,027

Capital loss carryforwards
922 1,808

Foreign tax credit carryforwards
— 6,401

Deferred income
3,211 3,079

(287,310 ) (296,143 )
Valuation allowance
(32,181 ) (27,165 )

Net deferred income taxes
$ (319,491 ) $ (323,308 )

		December 31, 2009			March 31, 2010

Deferred Tax Assets
	State net operating loss carryforwards	$	28,694		$	28,721
	Foreign tax credit carryforwards		9,442			12,329
	Capital loss carryforwards		1,808			1,472
	Other		14,297			12,495

Total deferred tax assets			54,241			55,017
Valuation allowance			(25,294	)		(25,364	)

Deferred tax assets, net of valuation allowance		$	28,947		$	29,653

Deferred Tax Liabilities
	Intangible asset amortization	$	(188,872	)	$	(184,024	)
	Convertible securities interest		(139,279	)		(142,898	)
	Non-deductible intangible amortization		(19,745	)		(87,291	)
	Other		(3,722	)		(8,703	)

Total deferred tax liabilities			(351,618	)		(422,916	)

	Net deferred tax liability	$	(322,671	)	$	(393,263	)

Deferred tax liabilities are primarily the result of tax deductions for the Company's intangible assets and convertible securities. The Company amortizes most of its intangible assets for tax purposes only, reducing its tax basis below its carrying value for financial statement purposes and generating deferred taxes each reporting period. In connection with the 2009 accounting changes, the Company recorded approximately $110,000 of deferred tax liabilities related to convertible securities interest to account for the future deferred tax impact of non-cash interest accretion. The Company's junior convertible trust preferred securities and 2008 senior convertible notes also generate deferred taxes because the Company's tax deductions are higher than the interest expense recorded for financial statement purposes.

In March 2010, in connection with the closing of the investment in Artemis (discussed in Note 16 below), the Company recorded a deferred tax liability of approximately $67,000 for the tax effect of acquiring intangible assets that are not deductible for tax purposes in the United Kingdom.

At ~~September 30, 2009,~~March 31, 2010, the Company has state net operating loss carryforwards that expire over a 15-year period beginning in ~~2009.~~2010. The Company also has foreign tax credit carryforwards that expire over a 10-year period beginning in ~~2009.~~2010. The valuation allowances at December 31, ~~2008~~2009 and ~~September 30, 2009~~March 31, 2010 were principally related to the uncertainty of the realization of the foreign tax credits and the state net operating loss carryforwards, which realization depends upon the Company's generation of sufficient taxable income prior to their expiration.

At ~~September 30, 2009,~~March 31, 2010, the Company's liability for uncertain tax positions was ~~$21,700,~~$22,249, including interest and related charges of ~~$4,312.~~$4,165. The Company does not anticipate that this liability will change significantly over the next twelve months.

The calculation of basic earnings per share is based on the weighted average number of shares of the Company's common stock outstanding during the period. Diluted earnings per share is similar to basic earnings per share, but adjusts for the dilutive effect of the potential issuance of incremental shares of the Company's common stock. The following is a reconciliation of the numerator and

denominator used in the calculation of basic and diluted earnings per share available to common stockholders. Unlike all other dollar amounts in these Notes, the amounts in the numerator reconciliation are not presented in thousands.

		For the Three Months Ended September 30,				For the Nine Months Ended September 30,					For the Three Months Ended March 31,

		2008		2009		2008		2009			2009		2010
Numerator:	Numerator:									Numerator:
Net Income (controlling interest)	Net Income (controlling interest)	$	16,471,000	$	17,769,000	$	82,329,000	$	34,873,000	Net Income (controlling interest)	$	6,125,000	$	17,462,000
Convertible securities interest expense, net			48,000		36,000		2,124,000		108,000
Interest expense on convertible securities, net of taxes										Interest expense on convertible securities, net of taxes		36,000		24,000

Net Income (controlling interest), as adjusted	Net Income (controlling interest), as adjusted	$	16,519,000	$	17,805,000	$	84,453,000	$	34,981,000	Net Income (controlling interest), as adjusted	$	6,161,000	$	17,486,000

Denominator:	Denominator:									Denominator:
Average shares outstanding—basic	Average shares outstanding—basic		39,522,159		41,854,249		37,770,720		41,115,819	Average shares outstanding—basic		40,022,423		42,360,311
Effect of dilutive instruments:	Effect of dilutive instruments:									Effect of dilutive instruments:
	Stock options		1,372,138		791,078		1,569,699		496,711	Stock options		185,904		917,575
	Forward sale		—		747,977		—		348,925	Forward sale		—		1,270,201
	Senior convertible securities		1,169,241		873,803		2,291,413		873,803	Senior convertible securities		873,803		873,629
	Mandatory convertible securities		—		—		127,864		—

Average shares outstanding—diluted	Average shares outstanding—diluted		42,063,538		44,267,107		41,759,696		42,835,258	Average shares outstanding—diluted		41,082,130		45,421,716

As more fully discussed in Notes 43 and 5,4, the Company had certain convertible securities outstanding during the periods presented and is required to apply the if-converted method to these securities in its calculation of diluted earnings per share. Under the if-converted method, shares that are issuable upon conversion are deemed outstanding, regardless of whether the securities are contractually convertible into the Company's common stock at that time. For this calculation, the interest expense (net of tax) attributable to these dilutive securities is added back to Net Income (controlling interest) ~~(reflecting~~reflecting the assumption that the securities have been ~~converted).~~converted. Issuable shares for these securities and related interest expense are excluded from the calculation if an assumed conversion would be anti-dilutive to diluted earnings per share.

The calculation of diluted earnings per share for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2009 and 2010 excludes the potential exercise of options to purchase ~~0.9~~4.2 million and ~~2.6~~1.3 million common shares, respectively, ~~and the assumed conversion of the junior convertible trust preferred securities and the 2008 senior convertible notes~~ because the effect would be anti-dilutive.

~~AFFILIATED MANAGERS GROUP, INC.~~ As discussed further in Note 18, the Company may settle portions of its Affiliate equity purchases in shares of its common stock. Because it is the Company's intent to settle these potential repurchases in cash, the calculation of diluted earnings per share excludes any potential dilutive effect from possible share settlements.

The Company and its Affiliates are subject to claims, legal proceedings and other contingencies in the ordinary course of their business activities. Each of these matters is subject to various uncertainties, and it is possible that some of these matters may be resolved in a manner unfavorable to the Company or its Affiliates. The Company and its Affiliates establish accruals for matters for which the outcome is probable and can be reasonably estimated. Management believes that any liability in excess of these accruals upon the ultimate resolution of these matters will not have a material adverse effect on the consolidated financial condition or results of operations of the Company.

Certain Affiliates operate under regulatory authorities which require that they maintain minimum financial or capital requirements. Management is not aware of any violations of such financial requirements occurring during the period.

The activity in the Affiliate investments in consolidated partnerships was as follows for the three months ended March 31, 2010:

Purchases and sales of investments (principally equity securities) were $73,160 and ~~gross client subscriptions and redemptions relating to Affiliate investments in consolidated partnerships were as follows:~~$73,443, respectively, for the three months ended March 31, 2010.

Management fees earned from these partnerships were ~~$989~~$162 and ~~$598~~$242 for the ~~nine~~three months ended ~~September 30, 2008~~March 31, 2009 and ~~2009,~~2010, respectively.

As of December 31, ~~2008~~2009 and ~~September 30, 2009,~~March 31, 2010, the Affiliates' investments in partnerships that are not consolidated were ~~$10,221~~$17,631 and ~~$28,337,~~$22,894, respectively. These assets are reported within "Other assets" in the Consolidated Balance Sheets. The income or loss related to these investments is classified within "Investment and other (income) loss" in the ~~consolidated statement~~Consolidated Statements of ~~income.~~Income.

The cost of ~~Affiliate~~ investments in marketable securities, gross unrealized gains and losses were as follows:

	December 31, 2008			September 30, 2009			December 31, 2009			March 31, 2010

Cost of Affiliate investments in marketable securities	$	14,984		$	16,498
Cost of investments in marketable securities							$	50,631		$	53,342
Gross unrealized gains		36			795			6,108			27,570
Gross unrealized losses		(4,621	)		(719	)		(49	)		(98	)

~~AFFILIATED MANAGERS GROUP, INC.~~11. Unsettled Fund Share Receivables and Payables

~~NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)~~ Unsettled fund share receivables and payables are created by the normal settlement periods on transactions initiated by certain clients of Affiliate funds domiciled in the United Kingdom. The gross presentation of the receivable ($154,740) and substantially offsetting payable ($159,039) reflects the legal relationship between the underlying investor and the Company.

The Company determines the fair value of certain investment securities and other financial and nonfinancial assets and liabilities. Fair value is determined based on the price that would be received

for an asset or paid to transfer a liability in the most advantageous market, utilizing a hierarchy of three different valuation techniques:

The following table summarizes the Company's ~~financial~~ assets (principally equity securities) and liabilities that are measured at fair value on a quarterly basis. ~~The Company did not have any nonfinancial assets or nonfinancial liabilities which required remeasurement during the three and nine months ended September 30, 2009.~~

During the three months ended March 31, 2010, there were no significant transfers of ~~the Company's~~financial assets between Level 1 and Level 2; financial assets valued at $3,709 transferred from Level 3 to Level 2. The fair value of Level 2 assets was determined using quoted prices for similar instruments ~~consist~~in active markets. The fair value of ~~Affiliate investments in partnerships.~~Level 3 assets and liabilities were determined using an income approach with assumptions made about future cash flows and discount rates.

Any change in the fair value of ~~these~~ investments in partnerships is presented as "Investment (income) loss from ~~Affiliate~~ investments in partnerships" in the Consolidated Statements of Income. However, the portion of this income or loss that is attributable to investors that are unrelated to the Company, if any, is

reported as "Net (income) loss (non-controlling interests in partnerships)." The following table presents the changes in Level 3 assets orand liabilities for the three ~~and nine~~ months ended ~~September 30, 2009:~~March 31, 2009 and 2010:

	For the Three Months Ended September 30,		For the Nine Months Ended September 30,		Three Months Ended March 31, 2009		Three Months Ended March 31, 2010			Three Months Ended March 31, 2009		Three Months Ended March 31, 2010

					Financial Assets					Financial Liabilities
Balance, beginning of period	$	4,185	$	4,185	$	4,185	$	4,009		$	—	$	27,074
Realized and unrealized gains (losses) included in net income		—		—		—		—			—		—
Realized and unrealized gains (losses) included in other comprehensive income		—		—		—		—			—		—
Purchases, issuances and settlements		—		—
Purchases or increases						—		—			—		49,105
Settlements						—		—			—		(27,074	)
Transfers in and/or out of Level 3		—		—		—		(3,709	)		—		—

Balance, September 30, 2009	$	4,185	$	4,185
Balance, end of period					$	4,185	$	300		$	—	$	49,105

Amount of total gains (losses) included in net income attributable to unrealized gains (losses) from assets still held at September 30, 2009	$	—	$	—
Amount of total gains (losses) included in net income attributable to unrealized gains (losses) from assets still held at end of period					$	—	$	2		$	—	$	—
Amount of total gains (losses) included in other comprehensive income					$	—	$	—		$	—	$	—

~~As of September 30, 2009, the~~The carrying amount of the Company's cash, cash equivalents and short-term investments approximates fair value because of the short-term nature of these instruments. The carrying value of notes receivable approximates fair value because interest rates and other terms are at market rates. The carrying value of notes payable approximates fair value principally because of the short-term nature of the notes. The carrying value of senior bank debt approximates fair value because the debt is a credit facility with variable interest based on selected short-term rates. The fair market value of the zero coupon senior convertible notes, the 2008 senior convertible notes, and the 2006 and 2007 junior convertible trust preferred securities at March 31, 2010 was ~~$55,941, $436,724~~$69,769, $456,550 and $512,761, respectively. The carrying value of the zero coupon senior convertible notes, the 2008 senior convertible notes, and the 2006 and 2007 junior convertible trust preferred securities was $47,323, $406,793 and $506,756,$542,697, respectively.

The Company periodically records amounts receivable and payable to Affiliate partners in connection with the transfer of Affiliate equity interests. As of December 31, ~~2008~~2009 and ~~September 30, 2009,~~March 31, 2010, the total receivable (reported in "Other assets") was ~~$42,808~~$45,253 and ~~$46,672,~~$41,114, respectively. The total payable as of December 31, ~~2008~~2009 was ~~$28,241,~~$109,888, of which ~~$26,187~~$109,888 is included in current liabilities. The total payable as of ~~September 30, 2009~~March 31, 2010 was ~~$88,142,~~$18,314, of which ~~$87,847~~$18,314 is included in current liabilities.

In certain cases, Affiliate management owners and Company officers may serve as trustees or directors of certain mutual funds from which the Affiliate earns advisory fee revenue.

The following summarizes the transactions of the Company's stock option and incentive plans for the ~~nine~~three months ended ~~September 30, 2009:~~March 31, 2010:

In addition, under the Company's Long-Term Executive Incentive and Deferred Compensation Plans, the Company granted awards during 2009. ~~The awards are denominated in the Company's common stock, with an aggregate fair value of $20,241.~~ Consistent with the Company's retention and incentive objectives, including the belief that long-term equity compensation is an effective and appropriate retention tool, the awards will be earned only if specified future performance goals are obtained, and are also subject to vesting and forfeiture provisions. ~~The Company will recognize expense for these awards ratably over the 4.5 year service period.~~

The Company's Net Income (controlling interest) for the three ~~and nine~~ months ended ~~September 30, 2009~~March 31, 2010 includes compensation expense of ~~$1,561 and $3,473, respectively~~$2,241 (net of income

tax benefits of ~~$999 and $2,222, respectively,~~$1,403 related to the Company's share-based compensation arrangements). As of ~~September 30, 2009,~~March 31, 2010, the deferred compensation expense related to share-based compensation arrangements was ~~$40,281,~~$43,781 which is expected to be recognized over a weighted average period of approximately four years (assuming no forfeitures). As of ~~September 30, 2009, 1.1~~March 31, 2010, 0.8 million options have expiration dates prior to the end of 2010.

During the first quarter of 2008, the Company entered into a series of treasury rate lock contracts with a notional value of $250,000 (each contract was designated and qualified as a cash flow hedge). These contracts were settled in the second quarter of 2008, and the Company received $8,154. During the fourth quarter of 2008, the Company concluded that it was probable that the hedged transaction would not occur and the gain was reclassified from accumulated other comprehensive income to Net Income (controlling interest).

Management has assessed and determined that the Company operates in three business segments representing the Company's three principal distribution channels: Mutual Fund, Institutional and High Net Worth, each of which has different client relationships.

Revenue in the Mutual Fund distribution channel is earned from advisory and sub-advisory relationships with all domestically-registered investment products as well as non-institutional investment products that are registered abroad. Revenue in the Institutional distribution channel is earned from relationships with foundations and endowments, defined benefit and defined contribution plans and Taft-Hartley plans. Revenue in the High Net Worth distribution channel is earned from relationships with wealthy individuals, family trusts and managed account programs.

Revenue earned from client relationships managed by Affiliates accounted for under the equity method is not consolidated with the Company's reported revenue but instead is included (net of operating expenses, including amortization) in "Income from equity method investments," and reported in the distribution channel in which the Affiliate operates. Income tax attributable to the profits of the Company's equity-method Affiliates is reported within the Company's consolidated income tax provision.

In firms with revenue sharing arrangements, a certain percentage of revenue is allocated for use by management of an Affiliate in paying operating expenses of that Affiliate, including salaries and bonuses, and is called an "Operating Allocation." In reporting segment operating expenses, Affiliate expenses are allocated to a particular segment on a pro rata basis with respect to the revenue generated by that Affiliate in such segment. Generally, as revenue increases, additional compensation is typically paid to Affiliate management partners from the Operating Allocation. As a result, the contractual expense allocation pursuant to a revenue sharing arrangement may result in the characterization of any growth in profit margin beyond the Company's Owners' Allocation as an operating expense. All other operating expenses (excluding intangible amortization) and interest expense have been allocated to segments based on the proportion of cash flow distributions reported by Affiliates in each segment.

For the Three Months Ended September 30, 2008

Mutual Fund Institutional High Net Worth Total
Revenue
$ 115,170 $ 141,647 $ 34,007 $ 290,824
Operating expenses:

Depreciation and other amortization
2,741 6,917 1,900 11,558

Other operating expenses
71,637 88,062 22,384 182,083

74,378 94,979 24,284 193,641

Operating income
40,792 46,668 9,723 97,183

Non-operating (income) and expenses:

Investment and other (income) loss
2,810 1,340 (285 ) 3,865

Income from equity method investments
(389 ) (11,327 ) (1,461 ) (13,177 )

Investment (income) loss from Affiliate investments in partnerships
— 922 21,919 22,841

Interest expense
6,493 11,116 2,274 19,883

8,914 2,051 22,447 33,412

Income before income taxes
31,878 44,617 (12,724 ) 63,771
Income taxes
9,433 12,413 2,537 24,383

Net income
22,445 32,204 (15,261 ) 39,388

Net income (non-controlling interests)
(16,072 ) (24,358 ) (4,484 ) (44,914 )

Net loss (non-controlling interests in partnerships)
— 539 21,458 21,997

Net Income (controlling interest)
$ 6,373 $ 8,385 $ 1,713 $ 16,471

For the Three Months Ended September 30, 2009

Mutual Fund Institutional High Net Worth Total
Revenue
$ 80,682 $ 109,918 $ 26,861 $ 217,461
Operating expenses:

Depreciation and other amortization
1,132 7,669 2,659 11,460

Other operating expenses
56,667 69,549 18,180 144,396

57,799 77,218 20,839 155,856

Operating income
22,883 32,700 6,022 61,605

Non-operating (income) and expenses:

Investment and other (income) loss
(4,501 ) (1,514 ) (599 ) (6,614 )

Income from equity method investments
(217 ) (7,397 ) (589 ) (8,203 )

Investment (income) loss from Affiliate investments in partnerships
(183 ) (606 ) (14,125 ) (14,914 )

Interest expense
4,685 12,341 2,514 19,540

(216 ) 2,824 (12,799 ) (10,191 )

Income before income taxes
23,099 29,876 18,821 71,796
Income taxes
(397 ) 3,731 602 3,936

Net income
23,496 26,145 18,219 67,860

Net income (non-controlling interests)
(14,372 ) (17,940 ) (3,147 ) (35,459 )

Net loss (non-controlling interests in partnerships)
(181 ) (605 ) (13,846 ) (14,632 )

Net Income (controlling interest)
$ 8,943 $ 7,600 $ 1,226 $ 17,769

		For the Nine Months Ended September 30, 2008													For the Three Months Ended March 31, 2009

		Mutual Fund			Institutional			High Net Worth			Total				Mutual Fund			Institutional			High Net Worth			Total
Revenue	Revenue	$	376,013		$	449,135		$	109,674		$	934,822		Revenue	$	68,338		$	82,238		$	27,899		$	178,475
Operating expenses:	Operating expenses:													Operating expenses:
	Depreciation and other amortization		8,364			19,994			5,777			34,135		Depreciation and other amortization		1,078			7,424			2,831			11,333
	Other operating expenses		234,423			282,163			68,890			585,476		Other operating expenses		45,140			57,662			19,615			122,417

			242,787			302,157			74,667			619,611				46,218			65,086			22,446			133,750

Operating income	Operating income		133,226			146,978			35,007			315,211		Operating income		22,120			17,152			5,453			44,725

Non-operating (income) and expenses:	Non-operating (income) and expenses:													Non-operating (income) and expenses:
	Investment and other (income) loss		5,180			1,373			(1,175	)		5,378		Investment and other (income) loss		625			(166	)		(218	)		241
	Income from equity method investments		(1,241	)		(35,221	)		(4,117	)		(40,579	)	Income from equity method investments		(70	)		(6,111	)		(235	)		(6,416	)
	Investment (income) loss from Affiliate investments in partnerships		(5	)		1,292			30,484			31,771		Investment (income) loss from Affiliate investments in partnerships		(3	)		69			3,729			3,795
	Interest expense		20,372			32,436			6,939			59,747		Interest expense		6,049			11,097			2,802			19,948

			24,306			(120	)		32,131			56,317				6,601			4,889			6,078			17,568

Income before income taxes	Income before income taxes		108,920			147,098			2,876			258,894		Income before income taxes		15,519			12,263			(625	)		27,157
Income taxes	Income taxes		24,831			31,541			6,689			63,061		Income taxes		2,956			793			168			3,917

Net income	Net income		84,089			115,557			(3,813	)		195,833		Net income		12,563			11,470			(793	)		23,240
	Net income (non-controlling interests)		(51,576	)		(75,485	)		(16,677	)		(143,738	)	Net income (non-controlling interests)		(7,936	)		(10,300	)		(2,642	)		(20,878	)
	Net loss (non-controlling interests in partnerships)		78			885			29,271			30,234		Net (income) loss (non-controlling interests in partnerships)		(3	)		69			3,697			3,763

Net Income (controlling interest)	Net Income (controlling interest)	$	32,591		$	40,957		$	8,781		$	82,329		Net Income (controlling interest)	$	4,624		$	1,239		$	262		$	6,125

		For the Nine Months Ended September 30, 2009													For the Three Months Ended March 31, 2010

		Mutual Fund			Institutional			High Net Worth			Total				Mutual Fund			Institutional			High Net Worth			Total
Revenue	Revenue	$	221,380		$	293,646		$	82,156		$	597,182		Revenue	$	97,925		$	121,772		$	31,324		$	251,021
Operating expenses:	Operating expenses:													Operating expenses:
	Depreciation and other amortization		3,221			22,569			8,289			34,079		Depreciation and other amortization		2,237			7,451			2,275			11,963
	Other operating expenses		152,121			198,349			56,609			407,079		Other operating expenses		67,366			83,399			20,576			171,341

			155,342			220,918			64,898			441,158				69,603			90,850			22,851			183,304

Operating income	Operating income		66,038			72,728			17,258			156,024		Operating income		28,322			30,922			8,473			67,717

Non-operating (income) and expenses:	Non-operating (income) and expenses:													Non-operating (income) and expenses:
	Investment and other (income) loss		(8,900	)		(3,241	)		(1,423	)		(13,564	)	Investment and other (income) loss		(770	)		(1,341	)		(711	)		(2,822	)
	Income from equity method investments		(426	)		(20,343	)		(1,201	)		(21,970	)	Income from equity method investments		(360	)		(7,823	)		(964	)		(9,147	)
	Investment (income) loss from Affiliate investments in partnerships		(186	)		(922	)		(24,957	)		(26,065	)	Investment (income) loss from Affiliate investments in partnerships		(52	)		(156	)		(3,883	)		(4,091	)
	Interest expense		15,932			34,879			7,870			58,681		Interest expense		6,070			11,091			2,690			19,851

			6,420			10,373			(19,711	)		(2,918	)			4,888			1,771			(2,868	)		3,791

Income before income taxes	Income before income taxes		59,618			62,355			36,969			158,942		Income before income taxes		23,434			29,151			11,341			63,926
Income taxes	Income taxes		4,593			5,973			1,027			11,593		Income taxes		4,831			4,896			1,438			11,165

Net income	Net income		55,025			56,382			35,942			147,349		Net income		18,603			24,255			9,903			52,761
	Net income (non-controlling interests)		(35,302	)		(42,370	)		(9,336	)		(87,008	)	Net income (non-controlling interests)		(10,994	)		(16,443	)		(3,848	)		(31,285	)
	Net loss (non-controlling interests in partnerships)		(184	)		(921	)		(24,363	)		(25,468	)	Net income (non-controlling interests in partnerships)		(52	)		(156	)		(3,806	)		(4,014	)

Net Income (controlling interest)	Net Income (controlling interest)	$	19,539		$	13,091		$	2,243		$	34,873		Net Income (controlling interest)	$	7,557		$	7,656		$	2,249		$	17,462

Total assets as of December 31, 2008		$	983,008		$	1,733,928		$	495,764		$	3,212,700
Total assets as of September 30, 2009			1,119,054			1,691,907			513,575			3,324,536
Balance Sheet Information														Balance Sheet Information
Total assets as of December 31, 2009														Total assets as of December 31, 2009	$	1,182,940		$	1,702,983		$	504,983		$	3,390,906
Total assets as of March 31, 2010														Total assets as of March 31, 2010		1,586,810			1,758,330			520,731			3,865,871

The Company periodically acquires interests from, makes additional purchase payments to and transfers interests to Affiliate management partners. During the three month period ended March 31, 2010, the Company incurred $4,450 of acquisition-related costs which were recognized as selling, general and administrative expenses. The Company did not incur any such costs during the period ended March 31, 2009.

The following table presents the change in goodwill during the ~~nine~~three months ended ~~September 30, 2009:~~March 31, 2010:

~~The Company performed its annual goodwill assessment as of September 30, 2009 and no impairments were identified.~~
AFFILIATED MANAGERS GROUP, INC.

The following table reflects the components of intangible assets of the Company's Affiliates that are consolidated as of December 31, ~~2008~~2009 and ~~September 30, 2009:~~March 31, 2010:

		December 31, 2008				September 30, 2009					December 31, 2009				March 31, 2010

		Carrying Amount		Accumulated Amortization		Carrying Amount		Accumulated Amortization			Carrying Amount		Accumulated Amortization		Carrying Amount		Accumulated Amortization
Amortized intangible assets:	Amortized intangible assets:									Amortized intangible assets:
	Acquired client relationships	$	399,886	$	176,261	$	405,739	$	175,446	Acquired client relationships	$	389,312	$	168,538	$	416,242	$	177,475
Non-amortized intangible assets:	Non-amortized intangible assets:									Non-amortized intangible assets:
	Acquired client relationships-mutual fund management contracts	$	267,783		—	$	355,311		—	Acquired client relationships-mutual fund management contracts		350,799		—		564,483		—
	Goodwill		1,243,583		—		1,406,615		—	Goodwill		1,413,217		—		1,521,222		—

For the Company's Affiliates that are consolidated, definite-lived acquired client relationships are amortized over their expected useful lives. As of ~~September 30, 2009,~~March 31, 2010, these relationships were being amortized over a weighted average life of approximately 10 years. The Company estimates that its consolidated annual amortization expense will be approximately ~~$33,000~~$36,000 for the next five years, assuming no additional investments in new or existing Affiliates.

The definite-lived acquired client relationships attributable to the Company's equity method investments are amortized over their expected useful lives. As of ~~September 30, 2009,~~March 31, 2010, these relationships were being amortized over approximately seven years. Amortization expense for these relationships was ~~$23,869~~$8,063 for the ~~nine~~three months ended ~~September 30, 2009.~~March 31, 2010. The Company estimates that the annual amortization expense attributable to its current equity-method Affiliates will be approximately ~~$31,500~~$32,000 for the next five years.

~~On August 26, 2009,~~Consistent with the Company's strategic objective to make investments in boutique investment management firms, in March 2010 the Company completed ~~its acquisition of~~ a majority ~~interest~~investment in ~~Harding Loevner LLC~~Artemis Investment Management Ltd ("~~Harding Loevner"~~Artemis")~~. Harding Loevner has assets under~~, a firm which specializes in active investment management for retail and institutional investors in ~~a range of investment strategies, including emerging markets, global~~the U.K. as well as Europe and ~~international products. The Company used cash to purchase an approximate 60% interest in Harding Loevner, with~~ the remaining interests retained by a broad group of senior professionals. The Company is contingently liable, upon achievement of specified targets of assets under management, to make payments of up to $60,000 in 2009 or early 2010.Middle East.

The Company's purchase price allocation is ~~subject to~~provisional because the ~~finalization~~Company has not yet completed the valuation of ~~its valuations and, as~~the acquired client relationships, deferred income taxes, contingent payment obligations or the non-controlling interest. As a result, ~~preliminary~~provisional amounts may be revised in future periods.

The excess of the ~~consideration transferred~~enterprise value over ~~the estimated fair value of~~ the net assets acquired ~~(including acquired client relationships of $118,621)~~ was recorded as goodwill, ~~$139,221.~~of which 94% and 6% was attributed to the Company's Mutual Fund and Institutional segments,

respectively. The ~~value of the interests retained by Harding Loevner management was measured using a financial model that included assumptions of cash flows and market multiples. The portion of~~ goodwill and acquired client relationships ~~attributable to the Company~~ are deductible for U.S. tax purposes over a ~~fifteen~~15 year life. The provisional allocation of the purchase price is as follows:

As part of this investment, the Company and the non-controlling interest are contingently liable to make payments of between zero and £105,000 in November of 2012 upon the achievement of specified revenue targets. The Company ~~has reflected~~measured the ~~entire contingent payment obligation in "Payables to related party" in the Consolidated Balance Sheets. The Company estimated the~~provisional fair value of the contingent payment obligation using a financial model that included assumptions of expected market performance and net client cash flows. Based on these assumptions, the Company projects a contingent payment of $80,332 in 2012. As of March 31, 2010, the present value of this payment was $49,105 ($24,061 is attributable to the non-controlling interest). These amounts are reported in "Other long-term liabilities."

Unaudited pro forma financial results are set forth below, giving consideration to the ~~Harding Loevner~~Artemis investment, as if such transactions occurred as of the beginning of ~~2008,~~2009, assuming the revenue sharing arrangement had been in effect for the entire period and after making certain other pro forma adjustments.

	For the Nine Months Ended September 30,				For the Three Months Ended March 31,

	2008		2009		2009		2010
Revenue	$	974,309	$	618,058	$	222,487	$	292,380
Net Income (controlling interest)		89,544		38,319		9,351		19,753
Earnings per share—basic	$	2.37	$	0.93		0.23		0.47
Earnings per share—diluted	$	2.20	$	0.90		0.23		0.43

~~Harding Loevner's~~Artemis' contribution to the Company's revenue and earnings in the quarter ended ~~September 30, 2009~~March 31, 2010 was not material.

In June 2009, the FASB issued guidance that establishes new criteria that must be met before transfers of financial assets are eligible for sale accounting and changes the amount that can be recognized as a gain or loss on a transfer accounted for as a sale when beneficial interests are received by the transferor. Disclosures are also required to provide information about transfers of financial assets and a transferor's continuing involvement with transferred financial assets. The Company will adopt this new guidance inDuring the first quarter of 2010, ~~and does not expect this~~the Company adopted a new standard ~~to have a material effect on the consolidated financial statements.~~

~~In June 2009, the FASB issued guidance~~ that requires an enterprise to ~~qualitatively assess the determination of the primary beneficiary of~~perform a qualitative analysis to determine whether its variable interests give it a controlling financial interest in a variable interest entity ("VIE") ~~based on whether~~. Under the ~~entity~~standard, an enterprise has a controlling financial interest when it has (a) the power to direct the activities of a VIE that most significantly impact the entity's economic performance and ~~has~~(b) the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. ~~This guidance also requires an ongoing reconsideration of~~An enterprise that holds a controlling financial interest is deemed to be the primary beneficiary and ~~amends the events that trigger a reassessment of whether an entity~~ is ~~a VIE. Disclosures are also~~

required to ~~provide information about an enterprise's involvement in a~~consolidate the VIE. This new standard has been deferred for certain entities that utilize the specialized accounting guidance for investment companies or that have the attributes of investment companies. The ~~Company will adopt~~adoption of the portions of this new ~~guidance in~~standard that were not deferred did not have a material impact on the Company's Consolidated Financial Statements.

During the first quarter of 2010, the Company adopted a new standard that eliminated the concept of a qualifying special-purpose entity ("QSPE"), changed the requirements for derecognizing financial assets, and ~~is currently evaluating~~required additional disclosures to enhance information reported to users of financial statements by providing greater transparency about transfers of financial assets, including an entity's continuing involvement in and exposure to the ~~potential impact~~risks related to transferred financial assets. The standard also clarified the requirements for isolation and limitations on portions of financial assets that are eligible for sale accounting. The adoption of this new ~~standard.~~

In June 2009, the FASB issued guidance that replaces all previously issued accounting standards and establishes the "FASB Accounting Standards Codification™" (the "Codification") as the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with generally accepted accounting principles in the United States. The Codification does not change Generally Accepted Accounting Principles and its adoptionstandard did not have ~~an effect~~a material impact on the Company's ~~financial results.~~Consolidated Financial Statements.

Many of the Company's operating agreements provide Affiliate managers a conditional right to require the Company to purchase their retained equity interests at certain intervals. Certain agreements also provide the Company a conditional right to require Affiliate managers to sell their retained equity interests to the Company upon their death, permanent incapacity or termination of employment and provide Affiliate managers a conditional right to require the Company to purchase such retained equity interests upon the occurrence of specified events. The purchase price of these conditional purchases are generally calculated based upon a multiple of the Affiliate's cash flow distributions, which is intended to represent fair value. Affiliate management partners are also permitted to sell their equity interests to other individuals or entities in certain cases, subject to the Company's approval or other restrictions.

The Company may pay for Affiliate equity purchases in cash, shares of its common stock or other forms of consideration and can consent to the transfer of these interests to other individuals or entities. The Company's cumulative redemption obligation for these interests has been presented as "Redeemable non-controlling interests" on the Company's Consolidated Balance Sheets. Changes in ~~redeemable non-controlling interests for the three and nine months ended September 30, 2009 are principally the result of changes to~~ the value of ~~these interests.~~the Company's cumulative redemption obligation are recorded to Additional paid-in capital. The following table presents the changes in Redeemable non-controlling interests during the period:

Although the timing and amounts of these purchases are difficult to predict, the Company expects to repurchase approximately ~~$50,000~~$100,000 of Affiliate equity during the next twelve months, and, in such event, will own the cash flow associated with any equity repurchased.

During the ~~nine~~three months ended ~~September 30, 2008~~March 31, 2009 and ~~2009,~~2010, the Company acquired interests from and transferred interests to Affiliate management partners. The following schedule discloses the effect of changes in the Company's ownership interest in its Affiliates on the controlling interest's equity:

	For the Three Months Ended September 30,						For the Nine Months Ended September 30,						For the Three Months Ended March 31,

	2008			2009			2008			2009			2009			2010
Net income	$	39,388		$	67,860		$	195,833		$	147,349		$	23,240		$	52,761
Foreign currency translation adjustment⁽¹⁾		(14,866	)		25,689			(22,394	)		40,644			(9,717	)		12,081
Change in net unrealized gain (loss) on investment securities		(11	)		103			110			(48	)		(155	)		13,311
Change in net unrealized loss on derivative securities		—			—			4,959			—

Comprehensive income		24,511			93,652			178,508			187,945			13,368			78,153
Comprehensive income (non-controlling interests)		(22,917	)		(50,091	)		(113,504	)		(112,476	)		(17,115	)		(35,299	)

Comprehensive income (controlling interest)	$	1,594		$	43,561		$	65,004		$	75,469
Comprehensive income (loss) (controlling interest)													$	(3,747	)	$	42,854

The components of accumulated other comprehensive income, net of applicable taxes, are as follows:

	December 31, 2008			September 30, 2009			December 31, 2009		March 31, 2010

Foreign currency translation adjustments	$	(3,721	)	$	36,923		$	43,055	$	55,136
Unrealized gain (loss) on investment securities		(360	)		(408	)
Unrealized gain on investment securities								2,903		16,214

Accumulated other comprehensive income	$	(4,081	)	$	36,515		$	45,958	$	71,350

On ~~November 9, 2009,~~April 15, 2010, the Company ~~announced it had acquired~~completed its investment in Aston Asset Management LLC ("Aston") through the acquisition of Highbury Financial Inc., Aston's parent company. Aston is the principal advisor to the Aston Funds, a ~~five percent interest in Value Partners Group Limited ("Value Partners"), a publicly traded asset management firm based in Hong Kong. In connection~~fund family of 24 sub-advised, no-load mutual funds with ~~the investment, AMG and Value Partners have agreed to work together on joint product development and strategic distribution opportunities. Value Partners manages~~total net assets of approximately ~~U.S. $4.6~~$7.6 billion ~~in assets through its core value-based investment approach.~~as of March 31, 2010.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

When used in this Quarterly Report on Form 10-Q, in our other filings with the United States Securities and Exchange Commission, in our press releases and in oral statements made with the approval of an executive officer, the words or phrases "will likely result," "are expected to," "will continue," "is anticipated," "may," "intends," "believes," "estimate," "project" or similar expressions are intended to identify "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties, including, among others, the following:

These factors (among others) could affect our financial performance and cause actual results to differ materially from historical earnings and those presently anticipated and projected. We will not undertake and we specifically disclaim any obligation to release publicly the result of any revisions which may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of events, whether or not anticipated. In that respect, we wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made.

We are ana global asset management company with equity investments in a diverse group of boutique investment management firms (our "Affiliates"). We pursue a growth strategy designed to generate shareholder value through the internal growth of our existing business, additional investments in investment management firms and strategic transactions and relationships ~~designed~~structured to enhance our Affiliates' businesses and growth prospects.

~~Through our Affiliates,~~As of March 31, 2010, we manage approximately ~~$199.3~~$232.1 billion in assets ~~(as of September 30, 2009)~~through our Affiliates (approximately $260.0 billion pro forma for the transactions discussed below in Pending Investments) in more than 300 investment products across a broad range of asset classes and investment styles in three principal distribution channels: Mutual Fund, Institutional and High Net Worth. We believe that our diversification across asset classes, investment styles and distribution channels helps to mitigate our exposure to the risks created by changing market environments. The following summarizes our operations in our three principal distribution channels.

On April 15, 2010, we completed our investment in Aston Asset Management LLC ("Aston") through the acquisition of Highbury Financial Inc., Aston's parent company. Based in Chicago, Aston offers sub-advised investment products to the mutual fund and managed accounts markets. Aston is the principal advisor to the Aston Funds, a fund family of 24 sub-advised, no-load mutual funds with total net assets of approximately $7.6 billion as of March 31, 2010.

In February 2010, we announced an agreement to purchase Pantheon Ventures Inc., Pantheon Holdings Limited and Pantheon Capital (Asia) Limited (collectively, "Pantheon"). Pantheon manages regional funds-of-funds in Europe, the United States and Asia, as well as global secondary funds-of-funds, global infrastructure fund-of-funds and customized separate account programs, with total assets under management of approximately $21 billion as of March 31, 2010. Subject to customary closing conditions, regulatory approvals and compliance with other terms of the purchase agreement, we anticipate the investment in Pantheon will close in the second quarter of 2010.

We operate our business through our Affiliates in our three principal distribution channels, maintaining each Affiliate's distinct entrepreneurial culture and independence through our investment structure. In making investments in boutique ~~asset~~investment management firms, we seek to partner with the highest quality firms in the industry, with outstanding management teams, strong long-term performance records and a demonstrated commitment to continued growth and success. Fundamental to our investment approach is the belief that Affiliate management equity ownership (along with AMG's ownership) aligns our interests and provides Affiliate managers with a powerful incentive to continue to grow their business. Our investment structure provides a degree of liquidity and diversification to principal owners of boutique investment management firms, while at the same time expanding equity ownership opportunities among the firm's management and allowing management to continue to participate in the firm's future growth. Our partnership approach also ensures that Affiliates maintain operational autonomy in managing their business, thereby preserving their firm's entrepreneurial culture and independence.

Although the specific structure of each investment is highly tailored to meet the needs of a particular Affiliate, in all cases, AMG establishes a meaningful equity interest in the firm, with the

remaining equity interests retained by the management of the Affiliate. Each Affiliate is organized as a separate firm, and its operating or shareholder agreement is structured to provide appropriate incentives for Affiliate management owners and to address the Affiliate's particular characteristics while also enabling us to protect our interests, including through arrangements such as long-term employment agreements with key members of the firm's management team.

�� In most cases, we own a majority of the equity interests of a firm and structure a revenue sharing arrangement, in which a percentage of revenue is allocated for use by management of that Affiliate in paying operating expenses of the Affiliate, including salaries and bonuses. We call this the "Operating Allocation." The portion of the Affiliate's revenue that is allocated to the owners of that Affiliate (including us) is called the "Owners' Allocation." Each Affiliate allocates its Owners' Allocation to its managers and to us generally in proportion to their and our respective ownership interests in that Affiliate. However, should actual operating expenses exceed the Operating Allocation, the excess expenses first reduce the portion of the Owners' Allocation allocated to the Affiliate's managers until that portion is eliminated, before reducing the portion allocated to us. Any such reduction in our portion of the Owners' Allocation is required to be paid back to us out of the portion of future Owners' Allocation allocated to the Affiliate's managers.

One of the purposes of our revenue sharing arrangements is to provide ongoing incentives for Affiliate managers by allowing them to participate in the growth of their firm's revenue, which may increase their compensation from both the Operating Allocation and the Owners' Allocation. These

arrangements also provide incentives to control operating expenses, thereby increasing the portion of the Operating Allocation that is available for growth initiatives and compensation.

An Affiliate's Operating Allocation is structured to cover its operating expenses. However, should actual operating expenses exceed the Operating Allocation, our contractual share of cash under the Owners' Allocation generally has priority over the allocations and distributions to the Affiliate's managers. As a result, the excess expenses first reduce the portion of the Owners' Allocation allocated to the Affiliate's managers until that portion is eliminated, before reducing the portion allocated to us. Any such reduction in our portion of the Owners' Allocation is required to be paid back to us out of the portion of future Owners' Allocation allocated to the Affiliate's managers.

Our minority investments are also structured to align our interests with those of the Affiliate's management through shared equity ownership, as well as to preserve the Affiliate's entrepreneurial culture and independence by maintaining the Affiliate's operational autonomy. In cases where we hold a minority ~~interest,~~investment, the revenue sharing arrangement generally allocates a percentage of the Affiliate's revenue to us. The remaining revenue is used to pay operating expenses and profit distributions to the other owners.

Certain of our Affiliates operate under profit-based arrangements through which we own a majority of the equity in the firm and receive a share of profits as cash flow, rather than a percentage of revenue through a typical revenue sharing agreement. As a result, we participate fully in any increase or decrease in the revenue or expenses of such firms. In these cases, we participate in a budgeting process and generally provide incentives to management through compensation arrangements based on the performance of the Affiliate.

We are focused on establishing and maintaining long-term partnerships with our Affiliates. Our shared equity ownership gives both AMG and our Affiliate partners meaningful incentives to manage their businesses for strong future growth. From time to time, we may consider changes to the structure of our relationship with an Affiliate in order to better support the firm's growth strategy.

Through our affiliated investment management firms, we derive most of our revenue from the provision of investment management services. Investment management fees ("asset-based fees") are usually determined as a percentage fee charged on periodic values of a client's assets under

management; most asset-based advisory fees are billed by our Affiliates quarterly. Certain clients are billed for all or a portion of their accounts based upon assets under management valued at the beginning of a billing period ("in advance"). Other clients are billed for all or a portion of their accounts based upon assets under management valued at the end of the billing period ("in arrears"). Most client accounts in the High Net Worth distribution channel are billed in advance, and most client accounts in the Institutional distribution channel are billed in arrears. Clients in the Mutual Fund distribution channel are billed based upon average daily assets under management. Advisory fees billed in advance will not reflect subsequent changes in the market value of assets under management for that period but may reflect changes due to client withdrawals. Conversely, advisory fees billed in arrears will reflect changes in the market value of assets under management for that period.

In addition, over 5075 Affiliate alternative investment and equity products, representing approximately ~~$30.0~~$35 billion of assets under management (as of ~~September 30, 2009)~~March 31, 2010), also bill on the basis of absolute or relative investment performance ("performance fees"). These products, which are primarily in the Institutional distribution channel, are often structured to have returns that are not directly correlated to changes in broader equity indices and, if earned, the performance fee component is typically billed less frequently than an asset-based fee. Although performance fees inherently depend on investment results and will vary from period to period, we anticipate performance fees to be a recurring component of our revenue. We also anticipate that, within any calendar year, the majority of any performance fees will typically be realized in the fourth quarter.

For certain of our Affiliates, generally where we own a non-controlling interest, we are required to use the equity method of accounting. Consistent with this method, we have not consolidated the operating results of these firms (including their revenue) in our Consolidated Statements of Income. Our share of these firms' profits (net of intangible amortization) is reported in "Income from equity method investments," and is therefore reflected in our Net Income (controlling interest) and EBITDA. As a consequence, increases or decreases in these firms' assets under management (which totaled ~~$52.6~~$57.4 billion as of ~~September 30, 2009)~~March 31, 2010) will not affect reported revenue in the same manner as changes in assets under management at our other Affiliates.

Our Net Income attributable to controlling interest reflects the revenue of our consolidated Affiliates and our share of income from Affiliates which we account for under the equity method, reduced by:

As discussed above, for consolidated Affiliates with revenue sharing arrangements, the operating expenses of the Affiliate as well as its managers' non-controlling interest generally increase (or decrease) as the Affiliate's revenue increases (or decreases) because of the direct relationship established in many of our agreements between the Affiliate's revenue and its Operating Allocation and Owners' Allocation. At our consolidated profit-based Affiliates, expenses may or may not correspond to increases or decreases in the Affiliates' revenues.

�� Our level of profitability will depend on a variety of factors, including:

The following table presents our Affiliates' reported assets under management by operating segment (which are also referred to as distribution channels in this Quarterly Report on Form 10-Q).

As shown in the assets under management table above, client cash inflows totaled ~~$30.6~~$11.3 billion while client cash outflows totaled ~~$37.7~~$12.8 billion for the ~~nine~~three months ended ~~September 30, 2009.~~March 31, 2010. The net flows for the ~~nine~~three months ended ~~September 30, 2009~~March 31, 2010 occurred across a broad range of product offerings in each of our distribution channels, with no individual cash inflow or outflow having a material impact on our revenue or expenses.

The operating segment analysis presented in the following table is based on average assets under management. For the Mutual Fund distribution channel, average assets under management represent an average of the daily net assets under management. For the Institutional and High Net Worth distribution channels, average assets under management ~~represent~~takes into consideration the billing patterns of

particular client accounts. For example, assets under management for an ~~average~~account that bills in advance is included in the table using beginning of ~~the~~period assets ~~at the beginning and~~under management while an account that bills in arrears uses end of ~~each calendar quarter during the applicable period.~~period assets under management. We believe that this analysis

more closely correlates to the billing cycle of each distribution channel and, as such, provides a more meaningful relationship to revenue.

		For the Three Months Ended September 30,							For the Nine Months Ended September 30,								For the Three Months Ended March 31,

(dollars in millions, except as noted)	(dollars in millions, except as noted)	2008		2009		% Change			2008		2009		% Change			(dollars in millions, except as noted)	2009		2010		% Change
Average assets under management (in billions)⁽¹⁾	Average assets under management (in billions)⁽¹⁾															Average assets under management (in billions)⁽¹⁾
Mutual Fund	Mutual Fund	$	51.2	$	39.0		(24	)%	$	55.5	$	35.2		(37	)%	Mutual Fund	$	32.1	$	47.2		47	%
Institutional	Institutional		147.3		119.5		(19	)%		158.6		111.6		(30	)%	Institutional		104.0		137.9		33	%
High Net Worth	High Net Worth		26.9		27.7		3	%		28.6		26.2		(8	)%	High Net Worth		25.4		30.2		19	%

	Total	$	225.4	$	186.2		(17	)%	$	242.7	$	173.0		(29	)%	Total	$	161.5	$	215.3		33	%

Revenue	Revenue															Revenue
Mutual Fund	Mutual Fund	$	115.2	$	80.7		(30	)%	$	376.0	$	221.4		(41	)%	Mutual Fund	$	68.3	$	97.9		43	%
Institutional	Institutional		141.6		109.9		(22	)%		449.1		293.6		(35	)%	Institutional		82.3		121.8		48	%
High Net Worth	High Net Worth		34.0		26.9		(21	)%		109.7		82.2		(25	)%	High Net Worth		27.9		31.3		12	%

	Total	$	290.8	$	217.5		(25	)%	$	934.8	$	597.2		(36	)%	Total	$	178.5	$	251.0		41	%

Net Income
Net Income (controlling interest)																Net Income (controlling interest)
Mutual Fund	Mutual Fund	$	6.4	$	9.0		41	%	$	32.6	$	19.5		(40	)%	Mutual Fund	$	4.6	$	7.6		65	%
Institutional	Institutional		8.4		7.6		(10	)%		40.9		13.1		(68	)%	Institutional		1.2		7.7		542	%
High Net Worth	High Net Worth		1.7		1.2		(29	)%		8.8		2.3		(74	)%	High Net Worth		0.3		2.2		633	%

	Total	$	16.5	$	17.8		8	%	$	82.3	$	34.9		(58	)%	Total	$	6.1	$	17.5		187	%

EBITDA⁽²⁾	EBITDA⁽²⁾															EBITDA⁽²⁾
Mutual Fund	Mutual Fund	$	25.1	$	14.5		(42	)%	$	86.3	$	43.8		(49	)%	Mutual Fund	$	14.9	$	20.9		40	%
Institutional	Institutional		43.3		38.2		(12	)%		138.0		97.3		(29	)%	Institutional		27.4		38.1		39	%
High Net Worth	High Net Worth		8.8		7.8		(11	)%		29.8		21.8		(27	)%	High Net Worth		6.9		9.2		33	%

	Total	$	77.2	$	60.5		(22	)%	$	254.1	$	162.9		(36	)%	Total	$	49.2	$	68.2		39	%

Our revenue is generally determined by the level of our assets under management, the portion of our assets across our products and three operating segments, which realize different fee rates, and the recognition of any performance fees. As described in the "Overview" section above, performance fees are generally measured on absolute or relative investment performance against a benchmark. As a result, the level of performance fees earned can vary significantly from period to period and these fees may not necessarily be correlated to changes in total assets under management.

Our total revenue ~~decreased $73.3~~increased $72.5 million (or ~~25%~~41%) in the three months ended ~~September 30, 2009,~~March 31, 2010, as compared to the three months ended ~~September 30, 2008,~~March 31, 2009, primarily from a ~~17% decrease~~33% increase in average assets under management. This ~~decrease~~increase in average assets under management resulted principally from ~~the decline in global equity markets and~~investment performance, partially offset by negative net client cash flows. ~~Unrelated to the change~~Performance fees were not a significant component of revenue in ~~assets under management, performance fees in~~either the three months ended ~~September 30, 2009 decreased as compared to~~March 31, 2010 or the three months ended ~~September 30, 2008 (2%~~March 31, 2009 (approximately 1% of revenue for ~~the three months ended September 30, 2009 and 6% of revenue for the three months ended September 30, 2008).~~

Our total revenue decreased $337.6 million (or 36%) in the nine months ended September 30, 2009, as compared to the nine months ended September 30, 2008, primarily from a 29% decrease in average assets under management. This decrease in average assets under management resulted principally from the decline in global equity markets and negative net client cash flows. Unrelated to the change in assets under management, performance fees in the nine months ended September 30, 2009 decreased as compared to the nine months ended September 30, 2008 (3% of revenue for the nine months ended September 30, 2009 and 6% of revenue for the nine months ended September 30, 2008)both time periods).

Our revenue in the Mutual Fund distribution channel ~~decreased $34.5~~increased $29.6 million (or ~~30%~~43%) in the three months ended ~~September 30, 2009~~March 31, 2010 as compared to the three months ended ~~September 30, 2008,~~March 31, 2009, while average assets under management decreased 24%, and decreased $154.6 million (or 41%) in the nine months ended September 30, 2009 as compared to the nine months ended September 30, 2008, while average assets under management decreased 37%increased 47%. The ~~decreases~~increase in average assets under management resulted principally from ~~the decline~~investment performance and our 2009 and 2010 investments in global equity markets and negative net client cash flows. Unrelated to the change in assets under management, our performance fees in the nine months ended September 30, 2009 declined as compared to the nine months ended September 30, 2008.new Affiliates.

Our revenue in the Institutional distribution channel ~~decreased $31.7~~increased $39.5 million (or ~~22%~~48%) in the three months ended ~~September 30, 2009~~March 31, 2010 as compared to the three months ended ~~September 30, 2008,~~March 31, 2009, while average assets under management decreased 19%, and decreased $155.5 million (or 35%) in the nine months ended September 30, 2009 as compared to the nine months ended September 30, 2008, while average assets under management decreased 30%increased 33%. The ~~decreases~~increase in average assets under management resulted principally from ~~the decline in global equity markets and~~investment performance, partially offset by negative net client cash flows. ~~Unrelated to~~The increase in revenue was proportionately greater than the ~~change~~increase in average assets under management as a result of an increase in assets under management ~~our performance fees in the nine months ended September 30, 2009 declined as compared to the nine months ended September 30, 2008.~~at Affiliates that realize comparatively higher fee rates.

Our revenue in the High Net Worth distribution channel ~~decreased $7.1~~increased $3.4 million (or ~~21%~~12%) in the three months ended ~~September 30, 2009~~March 31, 2010 as compared to the three months ended ~~September 30, 2008,~~March 31, 2009, while average assets under management increased 3%19%. This increase in average assets under management resulted principally from our 2008 and 2009 investments in new Affiliates, partially offset by the decline in global equity markets. The revenue during this period declined (notwithstanding the increase in average assets under management) as a result of the effects of advance billing of accounts, and the increase in assets under management that realize comparatively lower fee rates.investment performance.

Our revenue in the High Net Worth distribution channel decreased $27.5 million (or 25%) in the nine months ended September 30, 2009 as compared to the nine months ended September 30, 2008, while average assets under management decreased 8%. The decrease in average assets resulted principally from the decline in global equity markets, partially offset by our 2008 and 2009 investments in new Affiliates. The decline in revenue was proportionately greater than the decline in average assets under management as a result of the effects of advance billing, and the increase in assets under management that realize comparatively lower fee rates.

	For the Three Months Ended September 30,							For the Nine Months Ended September 30,							For the Three Months Ended March 31,

(dollars in millions)	2008		2009		% Change			2008		2009		% Change			2009		2010		% Change
Compensation and related expenses	$	123.7	$	105.2		(15	)%	$	415.6	$	292.8		(30	)%	$	84.2	$	119.2		42	%
Selling, general and administrative		53.5		28.3		(47	)%		154.5		93.0		(40	)%		32.5		46.1		42	%
Amortization of intangible assets		8.5		8.3		(2	)%		25.5		24.4		(4	)%		8.1		8.9		10	%
Depreciation and other amortization		3.0		3.2		7	%		8.7		9.6		10	%		3.3		3.0		(9	%)
Other operating expenses		4.9		10.9		122	%		15.3		21.4		40	%		5.7		6.1		7	%

Total operating expenses	$	193.6	$	155.9		(19	)%	$	619.6	$	441.2		(29	)%	$	133.8	$	183.3		37	%

The substantial portion of our operating expenses is incurred by our Affiliates, the majority of which is incurred by Affiliates with revenue sharing arrangements. For Affiliates with revenue sharing arrangements, an Affiliate's Operating Allocation percentage generally determines its operating expenses. Accordingly, our compensation expense is impacted by increases or decreases in each Affiliate's revenue and the corresponding increases or decreases in each Affiliate's respective Operating Allocation. During the three ~~and nine~~ months ended ~~September 30, 2009,~~March 31, 2010, approximately ~~$51.8 million and $124.9~~$55.9 million (or ~~49% and 43%~~47%)~~, respectively,~~ of our consolidated compensation expense was attributable to our Affiliate management partners. The percentage of revenue allocated to operating expenses varies from one Affiliate to another and may also vary within an Affiliate depending on the source or amount of revenue. As a result, changes in our aggregate revenue may not impact our consolidated operating expenses to the same degree.

Compensation and related expenses ~~decreased 15% and 30%~~increased 42% in the three ~~and nine~~ months ended ~~September 30, 2009,~~March 31, 2010, as compared to the three ~~and nine~~ months ended ~~September 30, 2008, respectively,~~March 31, 2009, primarily as a result of the relationship between revenue and operating expenses at Affiliates, which experienced ~~decreases~~increases in revenue, and accordingly, reported ~~lower~~higher compensation expenses. ~~These decreases were~~This increase was also attributable to ~~decreases~~an increase in aggregate Affiliate expenses of $5.1 million from new Affiliate investments as well as an increase in holding company share-based compensation of $2.5 million in the three months ended March 31, 2010 as compared to the three months ended March 31, 2009. These increases were partially offset by a decrease in aggregate Affiliate expenses from the transfer of our interests in certain Affiliates of ~~$4.6 million and $13.1~~$2.0 million in the three ~~and nine~~ months ended ~~September 30, 2009,~~March 31, 2010, as compared to the three ~~and nine~~ months ended September 30, 2008, respectively, as well as decreases in holding company share-based compensation of $1.2 million and $5.5 million in the three and nine months ended September 30, 2009, as compared to the three

and nine months ended September 30, 2008, respectively. These decreases were partially offset by increases in aggregate Affiliate expenses from new Affiliate investments of $5.6 million and $14.1 million in the three and nine months ended September 30, 2009, as compared to the three and nine months ended September 30, 2008, respectively.March 31, 2009.

Selling, general and administrative expenses ~~decreased 47% and 40%~~increased 42% in the three ~~and nine~~ months ended ~~September 30, 2009,~~March 31, 2010, as compared to the three ~~and nine~~ months ended ~~September 30, 2008, respectively. These decreases~~March 31, 2009. This increase resulted principally from ~~a $6.0~~an increase in aggregate Affiliate expenses of $8.6 million ~~insurance recovery in the three~~from new Affiliate investments and ~~nine months ended September 30, 2009, $5.6 million and $6.9~~$4.5 million of acquisition-related professional fees in the three ~~and nine~~ months ended September 30, 2008, respectively, which did not recur in the three and nine months ended September 30, 2009, as well as decreases in sub-advisory and distribution expenses attributable to a decline in assets under management at our Affiliates in the Mutual Fund distribution channel. The decrease in the nine months ended September 30, 2009March 31, 2010 as compared to the ~~nine~~three months ended ~~September 30, 2008~~March 31, 2009.

Amortization of intangible assets increased 10% in the three months ended March 31, 2010 as compared to the three months ended March 31, 2009. This increase was ~~also~~principally attributable to ~~a decrease of $5.1 million~~an increase in sub-advisory and administrative costs related to performance fees. In each period, these decreases were partially offset by increases in aggregate Affiliate expenses of $1.8 million and $3.7 million, respectively,definite-lived intangible assets resulting from new Affiliate investments.

~~Amortization of intangible assets~~Depreciation and other amortization decreased ~~2% and 4%~~9% in the three ~~and nine~~ months ended ~~September 30, 2009~~March 31, 2010 as compared to the three ~~and nine~~ months ended ~~September 30, 2008, respectively. These decreases were~~March 31, 2009, principally attributable to a decrease in ~~definite-lived intangible~~spending on depreciable assets in recent periods, partially offset by ~~new Affiliate investments in 2009.~~

Depreciation and other amortization increased 7% and 10% in the three and nine months ended September 30, 2009 as compared to the three and nine months ended September 30, 2008, principally attributable to an increase of $0.1 million in aggregate Affiliate expenses from new Affiliate investments.

Other operating expenses increased ~~122% and 40%~~7% in the three ~~and nine~~ months ended ~~September 30, 2009~~March 31, 2010 as compared to the three ~~and nine~~ months ended ~~September 30, 2008, as a result of a loss realized on the transfer of~~March 31, 2009, principally attributable an increase in aggregate Affiliate ~~interests in 2009.~~expenses from new Affiliate investments.

	For the Three Months Ended September 30,								For the Nine Months Ended September 30,								For the Three Months Ended March 31,

(dollars in millions)	2008			2009		% Change			2008			2009		% Change			2009			2010		% Change
Income from equity method investments	$	13.2		$	8.2		(38	)%	$	40.6		$	22.0		(46	)%	$	6.4		$	9.1		42	%
Investment and other income (loss)		(3.9	)		6.6		N.M.	⁽¹⁾		(5.4	)		13.6		N.M.	⁽¹⁾		(0.2	)		2.8		n.m.	⁽¹⁾
Investment income (loss) from Affiliate investments in partnerships		(22.8	)		14.9		N.M.	⁽¹⁾		(31.8	)		26.1		N.M.	⁽¹⁾		(3.8	)		4.1		n.m.	⁽¹⁾
Interest expense		19.9			19.5		(2	)%		59.7			58.7		(2	)%		19.9			19.9		0	%
Income tax expense		24.4			4.0		(84	)%		63.1			11.6		(82	)%		3.9			11.2		187	%

Income from equity method investments consists of our share of income from Affiliates that are accounted for under the equity method of accounting, net of any related intangible amortization. Income from equity method investments ~~decreased 38% and 46%~~increased 42% in the three ~~and nine~~ months ended ~~September 30, 2009,~~March 31, 2010 as compared to the three ~~and nine~~ months ended ~~September 30, 2008, respectively. These decreases were~~March 31, 2009, principally ~~the~~as a result of ~~declines~~increases in assets under management at

Affiliates that we account for under the equity method of accounting. These decreases also resulted from increases in intangible amortization expense of $3.1 million and $9.0 million in the three and nine months ended September 30, 2009, as compared to the three and nine months ended September 30, 2008, respectively.

Investment and other income increased significantly in the three ~~and nine~~ months ended ~~September 30, 2009,~~March 31, 2010 as compared to the three ~~and nine~~ months ended ~~September 30, 2008,~~March 31, 2009, principally as a result of an increase in Affiliate investment earnings. Investment and other income also improved in the nine months ended September 30, 2009 as compared to the nine months ended September 30, 2008 because of $2.0 million of expenses incurred on the settlement of our 2004 mandatory convertible securities and the conversion of our floating rate senior convertible securities in 2008, which did not recur in 2009.

Investment income (loss) from Affiliate investments in partnerships relates to the consolidation of certain investment partnerships in which our Affiliates are the general partner. For the three months ended ~~September 30, 2008~~March 31, 2009 and ~~2009,~~2010, the income (loss) from Affiliate investments in partnerships was ~~$(22.8)~~$(3.8) million and ~~$14.9 million, respectively. For the nine months ended September 30, 2008 and 2009, the income (loss) from Affiliate investments in partnerships was $(31.8) million and $26.1~~$4.1 million, respectively. This income (loss) was principally attributable to investors who are unrelated to us.

Interest expense ~~decreased 2%~~was generally flat in the three ~~and nine~~ months ended ~~September 30, 2009,~~March 31, 2010, as compared to the three ~~and nine~~ months ended ~~September 30, 2008. These decreases were principally attributable to decreases~~March 31, 2009, as a decrease in the cost of our senior bank debt of ~~$3.1~~$0.3 million ~~and $14.3 million~~(which resulted from a decline in borrowings) was offset by an increase in the interest accretion on our senior convertible securities.

Income taxes increased 187% in the three ~~and nine~~ months ended ~~September 30, 2009~~March 31, 2010, as compared to the three ~~and nine~~ months ended ~~September 30, 2008, respectively, resulting from a decline in borrowings as well as decreases of $0.9 million and $2.7 million in the three and nine months ended September 30,~~March 31, 2009, as ~~compared to~~a result of the three and nine months ended September 30, 2008, respectively, resulting from the repurchase of a portion of our 2007 junior convertible trust preferred securities in the fourth quarter of 2008. The decrease in the nine months ended September 30, 2009 as compared to the nine months ended September 30, 2008 also resulted from a $4.8 million decrease from the conversion of our floating rate senior convertible securities and the settlement of our mandatory convertible securities in 2008. These decreases were partially offset by increases of $3.3 million and $20.1 million in the three and nine months ended September 30, 2009 as compared to the three and nine months ended September 30, 2008, respectively, attributable to the issuance of our 2008 senior convertible notes in the third quarter of 2009.

~~Income taxes decreased 84% and 82% in the three and nine months ended September 30, 2009, as compared to the three and nine months ended September 30, 2008, respectively, from the decreases~~increase in Net Income (controlling interest) and $6.1 million of benefits realized from the restructuring of relationships with certain Affiliates. The decrease in income taxes in the nine months ended September 30, 2009, as compared to the nine months ended September 30, 2008, was also attributable to a $3.0 million reduction in valuation allowances on state net operating losses..

	For the Three Months Ended September 30,								For the Nine Months Ended September 30,									For the Three Months Ended March 31,

(dollars in millions)	2008			2009		% Change			2008			2009		% Change			(dollars in millions)	2009			2010		% Change
Net income (non-controlling interests)	$	44.9		$	35.5		(21	)%	$	143.7		$	87.0		(39	)%	Net income (non-controlling interests)	$	20.9		$	31.3		50	%
Net income (loss) (non-controlling interests in partnerships)		(22.0	)		14.6		N.M.	⁽¹⁾		(30.2	)		25.5		N.M.	⁽¹⁾
																	Net income (loss) (non-controlling interests in partnerships)		(3.8	)		4.0		n.m.	⁽¹⁾
Net Income (controlling interest)		16.5			17.8		8	%		82.3			34.9		(58	)%	Net Income (controlling interest)		6.1			17.5		187	%

Net income attributable to non-controlling interests ~~decreased 21% and 39%~~increased 50% in the three ~~and nine~~ months ended ~~September 30, 2009,~~March 31, 2010, as compared to the three ~~and nine~~ months ended ~~September 30, 2008, respectively,~~March 31, 2009, principally as a result of the previously discussed changes in revenue.

Net income (loss) (non-controlling interest in partnerships) relates to the consolidation of certain investment partnerships in which our Affiliates are the general partner. For the three months ended ~~September 30, 2008~~March 31, 2009 and ~~2009,~~2010, the net income (loss) from Affiliate investment partnerships attributable to the non-controlling interests was ~~$(22.0)~~$(3.8) million and $14.6 million, respectively. For the nine months ended September 30, 2008 and 2009, the net income (loss) from Affiliate investment partnerships attributable to the non-controlling interests was $(30.2) million and $25.5$4.0 million, respectively.

Net Income (controlling interest) increased 8%187% in the three months ended ~~September 30, 2009,~~March 31, 2010, as compared to the three months ended ~~September 30, 2008~~March 31, 2009 as a result of increases in investment and other income and decreases in income taxes, partially offset by decreases in operating income and income from equity method investments, as described above. The decrease in Net Income (controlling interest) in the nine months ended September 30, 2009, as compared to the nine months ended September 30, 2008, resulted principally from decreases in revenue and income from equity method ~~investments,~~investments. These increases were partially offset by ~~decreases~~increases in reported operating and income tax ~~and~~expenses as well as Net income attributable to non-controlling interest, ~~expenses and an increase in investment and other income,~~ as described above.

As supplemental information, we provide a non-GAAP performance ~~measure~~measures that we refer to as Cash Net ~~Income. This~~Income and Cash earnings per share. We consider Cash Net Income as an important measure isof our financial performance, as we believe it best represents our operating performance before non-cash expenses relating to our acquisition of interests in our investment management firms. Cash Net Income and Cash earnings per share are used by our management and Board of Directors as our principal performance benchmarks, including as measures for aligning executive compensation with stockholder value. These measures are provided in addition to, but not as a substitute for, Net Income (controlling interest). and Earnings per share; Cash Net Income and Cash earnings per share are not liquidity measures and should not be used in place of any liquidity measure calculated under GAAP. These measures facilitate comparisons to other asset management firms that have not engaged in significant acquisitions or issued convertible debt.

Under our Cash Net Income definition, we add to Net Income (controlling interest) amortization (including equity method amortization) ~~and~~, deferred taxes related to intangible assets, ~~and~~ Affiliate depreciation and Affiliate equity ~~expenses,~~expense, and exclude the non-cash effect of ~~recent changes~~APB 14-1 (principally imputed interest on convertible securities) and non-cash expenses related to the accounting for convertible debt ("APB 14-1"). We consider Cash Net Income an important measure of our financial performance, as we believe it best represents operating performance before non-cash expenses relating to our acquisition of interests in our Affiliates. Cash Net Income is used by our management and Board of Directors as a principal performance benchmark, including as a measure for aligning executive compensation with stockholder value.

Since our acquired assets do not generally depreciate or require replacement by us, and since they generate deferred tax expenses that are unlikely to reverse, we add back these non-cash expenses to Net Income (controlling interest) to measure operating performance.contingent payment arrangements. We add back amortization attributable to acquired client relationships because this expense does not correspond to the changes in value of these assets, which do not diminish predictably over time. The portion of deferred taxes generally attributable to intangible assets (including goodwill) that we no longer amortize but which

continues to generate tax deductions is added back, because we believe it is unlikely these accruals will be used to settle material tax obligations. Since our acquired assets do not generally depreciate or require replacement by us, and since they generate deferred tax expenses that are unlikely to reverse, we add back these non-cash expenses to Net Income to measure operating performance. We add back non-cash expenses relating to certain transfers of equity between Affiliate management partners, when these transfers have no dilutive effect to our shareholders. We add back the portion of consolidated depreciation expense incurred by our Affiliates because under our Affiliates' operating agreements we are generally not required to replenish these depreciating assets.

Cash earnings per share represents Cash Net Income divided by the adjusted diluted average shares outstanding, which measures the potential share issuance from our senior convertible securities and junior convertible securities (each further described in Liquidity and Capital Resources) using a "treasury stock" method. Under this method, only the net number of shares of common stock equal to the value of these securities in excess of par, if any, are deemed to be outstanding. We believe the inclusion of net shares under a treasury stock method best reflects the benefit of the increase in available capital resources (which could be used to repurchase shares of common stock) that occurs

when these securities are converted and we are relieved of our debt obligation. This method does not take into account any increase or decrease in our cost of capital in an assumed conversion.

In connection with recent ~~accounting changes (see Note 2 to~~investments in Affiliates, in the ~~consolidated financial statements),~~first quarter of 2010 we modified our Cash Net Income definition to ~~add back~~exclude non-cash ~~charges~~imputed interest and revaluation adjustments related to ~~certain Affiliate equity transfers (referred to as Affiliate equity expense) and APB 14-1 (both net~~contingent payment arrangements from Net Income (controlling interest). The modification of ~~tax). In prior periods,~~the Cash Net Income ~~was defined as "Net Income plus amortization and deferred taxes relating to intangible assets plus Affiliate depreciation." Under this prior~~ definition ~~Cash Net Income~~did not have an impact on the periods reported ~~for the three and nine months ended September 30, 2008 was $54.2 million and $170.3 million, respectively.~~herein.

The following table provides a reconciliation of Net Income (controlling interest) to Cash Net ~~Income:~~Income and the calculation of Cash earnings per share:

		For the Three Months Ended September 30,				For the Nine Months Ended September 30,					For the Three Months Ended March 31,

(in millions)		2008		2009		2008		2009
(in millions, except shares and per share data)										(in millions, except shares and per share data)	2009			2010
Net Income (controlling interest)	Net Income (controlling interest)	$	16.5	$	17.8	$	82.3	$	34.9	Net Income (controlling interest)	$	6.1		$	17.5
	Intangible amortization		13.5		16.1		40.3		48.1	Intangible amortization⁽¹⁾		16.0			16.7
	Intangible-related deferred taxes		14.1		6.2		32.2		25.3	Intangible-related deferred taxes		9.6			10.7
	APB 14-1 expense		5.0		2.0		6.5		6.2	Imputed interest and contingent payment adjustments		2.1			2.3
	Affiliate equity expense		2.0		1.6		6.9		5.5	Affiliate equity expense		2.0			1.7
	Affiliate depreciation		1.7		1.9		4.9		5.8	Affiliate depreciation		1.9			1.9
														��
Cash Net Income	Cash Net Income	$	52.8	$	45.6	$	173.1	$	125.8	Cash Net Income	$	37.7		$	50.8

Average shares outstanding—diluted										Average shares outstanding—diluted		41,082,130			45,421,716
										Assumed issuance of senior convertible securities shares		(873,803	)		(873,629	)
										Assumed issuance of junior convertible securities shares		—			—
										Dilutive impact of senior convertible securities shares		—			209,713
										Dilutive impact of junior convertible securities shares		—			—

Average shares outstanding—adjusted diluted										Average shares outstanding—adjusted diluted		40,208,327			44,757,800

Cash earnings per share										Cash earnings per share	$	0.94		$	1.14

Cash Net Income ~~decreased 14% and 27%~~increased 35% in the three ~~and nine~~ months ended ~~September 30, 2009,~~March 31, 2010 as compared to the three ~~and nine~~ months ended ~~September 30, 2008, respectively,~~March 31, 2009, primarily as a result of the previously-described factors that caused ~~a decrease~~an increase in Net Income ~~partially offset by~~as well as increases in amortization and intangible-related deferred tax expenses.

The following table summarizes certain key financial data relating to our liquidity and capital resources:

(in millions)	December 31, 2008		September 30, 2009		December 31, 2009		March 31, 2010

Balance Sheet Data
Cash and cash equivalents	$	396.4	$	225.3	$	259.5	$	203.8
Senior debt		233.5		—
Senior convertible securities		445.5		454.1
Senior bank debt						—		170.0
2008 senior convertible notes						409.6		412.7
Zero coupon convertible notes						47.4		47.4
Junior convertible trust preferred securities		505.0		506.8		507.4		508.0

	For the Three Months Ended September 30,						For the Nine Months Ended September 30,						For the Three Months Ended March 31,

	2008			2009			2008			2009			2009			2010
Cash Flow Data
Operating cash flow	$	187.3		$	80.2		$	430.1		$	168.1		$	15.7		$	68.0
Investing cash flow		(3.0	)		(136.7	)		(77.5	)		(145.4	)		(3.7	)		(131.9	)
Financing cash flow		27.0			5.3			(170.5	)		(197.0	)		(170.7	)		7.5
EBITDA⁽¹⁾		77.2			60.5			254.1			162.9			49.2			68.2

We view our ratio of debt to EBITDA (our "internal leverage ratio") as an important gauge of our ability to service debt, make new investments and access additional capital. Consistent with industry practice, we do not consider junior trust preferred securities as debt for the purpose of determining our internal leverage ratio. We also view our leverage on a "net debt" basis by deducting from our debt balance holding company cash (including prospective proceeds from the settlement of our forward equity sale agreements). At ~~September 30, 2009,~~March 31, 2010, our internal leverage ratio was ~~0.5:~~1.2:1.

Under the terms of our credit facility we are required to meet two financial ratio covenants. The first of these covenants is a maximum ratio of debt to EBITDA (the "bank leverage ratio") of ~~3.50.~~3.5. The calculation of our bank leverage ratio is generally consistent with our internal leverage ratio approach. The second covenant is a minimum EBITDA to cash interest expense ratio of ~~3.00~~3.0 (our "bank interest coverage ratio"). For the purposes of calculating these ratios, share-based compensation expense is added back to EBITDA. As of ~~September 30, 2009,~~March 31, 2010, our actual bank leverage and bank interest coverage ratios were ~~2.00~~2.4 and ~~5.02,~~5.0, respectively, and we were in full compliance with all terms of our credit facility. Following the closing of our investment in Aston, we have $600 million of remaining capacity under our $770 million credit facility, of which we could borrow a total of $575 million without violating credit facility covenants.

Our investment in Aston was closed in April and was financed through the issuance of 1.7 million shares of our common stock. We plan to finance our investment in Pantheon with borrowings under our credit facility and $100 million of proceeds from the partial settlement of forward equity sales. Following the closing of our pending new investments, we anticipate our bank leverage ratio will increase to approximately 3.0.

We are rated BBB- by Standard & Poor's. A downgrade of our credit rating, either as a result of industry or company-specific considerations, would not have a material financial effect on any of our agreements or securities (or otherwise trigger a default).

In addition to borrowings available under our $770 million revolving credit facility, our current liquidity is augmented by approximately $375 million of holding company cash (including prospective proceeds from the forward equity settlements) and the free cash flow generated by our business. We have no near-term debt maturities.

As supplemental information in this Quarterly Report on Form 10-Q, we have provided information regarding our EBITDA, a non-GAAP liquidity measure. This measure is provided in addition to, but not as a substitute for, cash flow from operations. EBITDA represents earnings before interest expense, income taxes, depreciation and amortization. EBITDA, as calculated by us, may not be consistent with computations of EBITDA by other companies. As a measure of liquidity, we believe that EBITDA is useful as an indicator of our ability to service debt, make new investments and meet working capital requirements. We further believe that many investors use this information when analyzing the financial position of companies in the investment management industry.

The following table provides a reconciliation of cash flow from operations to EBITDA:

		For the Three Months Ended September 30,						For the Nine Months Ended September 30,							For the Three Months Ended March 31,

(in millions)	(in millions)	2008			2009			2008			2009			(in millions)	2009			2010
Cash flow from operations	Cash flow from operations	$	187.3		$	80.2		$	430.1		$	168.1		Cash flow from operations	$	15.7		$	68.0
	Interest expense, net of non-cash items⁽¹⁾		16.3			14.2			52.1			42.9		Interest expense, net of non-cash items⁽¹⁾		14.7			14.2
	Current tax provision		6.2			0.1			31.7			(9.1	)	Current tax provision		(8.0	)		2.5
	Income from equity method investments, net of distributions⁽²⁾		2.1			2.5			(10.0	)		3.3		Income from equity method investments, net of distributions⁽²⁾		(4.6	)		(6.0	)
	Changes in assets and liabilities and other adjustments⁽³⁾		(134.7	)		(36.5	)		(249.8	)		(42.3	)	Changes in assets and liabilities and other adjustments⁽³⁾		31.4			(10.5	)

EBITDA	EBITDA	$	77.2		$	60.5		$	254.1		$	162.9		EBITDA	$	49.2		$	68.2

In the ~~nine~~three months ended ~~September 30, 2009,~~March 31, 2010, we met our cash requirements primarily through cash generated by operating activities. Our principal uses of cash in the ~~nine~~three months ended ~~September 30, 2009~~March 31, 2010 were to make distributions to Affiliate managers and repay our senior bank debt. We expect that our principal uses of cash for the foreseeable future will be for investments in new and existing Affiliates, distributions to Affiliate managers, payment of interest on outstanding debt, the repurchase of debt securities, and the repurchase of shares of our common stock and for working capital purposes.

The following table summarizes the principal amount due at maturity of our debt obligations and convertible securities as of ~~September 30, 2009:~~March 31, 2010:

(in millions)	Amount					Amount		Maturity Date	Form of Repayment

Senior Bank Debt	$	—	2012	(1	)	$	170.0	2012	(1)
Zero Coupon Senior Convertible Notes		50.1	2021	(2	)		50.1	2021	(2)
2008 Senior Convertibles Notes		460.0	2038	(3	)		460.0	2038	(3)
Junior Convertible Trust Preferred Securities		730.8	2036/2037	(4	)		730.8	2036/2037	(4)

In the fourth quarter of 2007, we entered into an amended and restated senior credit facility (the "Facility"). During the third quarter of 2008, we increased our borrowing capacity to $1.01 billion, comprised ofWe have a $770 million revolving credit facility (the "Revolver") ~~and a $240 million term loan (the "Term Loan"). In the first quarter of 2009,~~under which we ~~repaid the outstanding balance of the Term Loan ($233.5 million); the capacity under the Revolver remains at $770 million. We~~ pay interest ~~on these obligations~~ at specified rates (based either on the ~~Eurodollar~~LIBOR rate or the prime rate as in effect from time to time) that vary depending on our credit rating. Subject to the agreement of lenders to provide additional commitments, we have the option to increase the ~~Facility~~Revolver by up to ~~an additional~~ $175 million.

The Revolver ~~will mature in February 2012, and~~ contains financial covenants with respect to leverage and interest ~~coverage. The Facility also contains~~coverage and customary affirmative and negative covenants, including limitations on indebtedness, liens, cash dividends and fundamental corporate changes. Borrowings under the ~~Facility~~Revolver are collateralized by pledges of the substantial majority of our capital stock or other equity interests owned by us. WeAs of March 31, 2010, we had no$170 million outstanding ~~borrowings at September 30, 2009.~~under the Revolver.

~~In 2001, we issued $251 million~~We have two senior convertible securities outstanding at March 31, 2010. The principal terms of these notes are summarized below.

The zero coupon convertible notes"), with each note issued at 90.50% of such principal amount and accreting at a rate of 0.50% per year (2009 accounting changes did not affect these securities). As of September 30, 2009, $50.1 million principal amount at maturity remains outstanding. Each security isnotes are convertible into ~~17.429~~a defined number of shares of our common stock ~~(at a current base conversion price of $54.16)~~ upon the occurrence of certain events, including the following: (i) if the closing price of a share of our common stock is more than a specified price over certain periods (initially $62.36 and increasing incrementally at the end of each calendar quarter to $63.08 in April 2021); (ii) if the credit rating assigned by Standard & Poor's to the securities is below BB-; or (iii) if we call the securities for redemption.events. The holders may ~~require~~put these securities to us ~~to repurchase the securities at their accreted value~~ in May 2011 and 2016. If the holders exercise this option, inwe can settle the ~~future, we may elect to repurchase the securities~~repurchases with cash or shares of our common stock, or ~~some~~a combination thereof. We have the option to ~~redeem the~~call securities at any time for cash at their accreted value. ~~Under the terms of the indenture governing the zero coupon~~

The 2008 convertible notes a holder may convert such security into common stock by following the conversion procedures in the indenture. Subject to changes in the price of our common stock, the zero coupon convertible notes may be convertible in certain future periods.

In August 2008, we issued $460 million of senior convertible notes due 2038 ("2008 senior convertible notes"). The 2008 senior convertible notes bear interest at 3.95%, payable semi-annually in cash. We are accreting the carrying value to the principal amount at maturity using an interest rate of 7.4% (over its expected life of five years), resulting in incremental interest expense for 2009 of approximately $11.2 million. Each security is convertible into ~~7.959~~a defined number of shares of our common stock ~~(at an initial conversion price of $125.65)~~ upon the occurrence of certain events. Upon conversion, we may elect to pay or deliver cash, shares of common stock, or some combination thereof. The holders of the 2008 ~~senior~~ convertible notes may ~~require~~put these securities to us ~~to repurchase the notes~~ in August of 2013, 2018, 2023, 2028 and 2033. We may ~~redeem~~call the notes for cash ~~(subject to the holders right to convert)~~ at any time on or after August 15, 2013.

The 2008 senior convertible notes are considered contingent payment debt instruments under federal income tax regulations. These regulations require us to deduct interest in an amount greater than our reported interest expense, which will result in annual deferred tax liabilities of approximately

~~$10.2 million. These deferred tax liabilities will be reclassified directly to stockholders' equity if our common stock is trading above certain thresholds at the time of the conversion of the notes.~~

~~In 2006, we issued $300 million of~~We have two junior ~~subordinated convertible debentures due 2036 to a wholly-owned trust simultaneous with the issuance, by the trust, of $291 million of~~ convertible trust preferred securities ~~to investors. The junior subordinated convertible debentures and convertible trust preferred securities (together, the~~outstanding at March 31, 2010, one issued in 2006 (the "2006 junior convertible trust preferred securities") ~~have substantially the same terms.~~

~~The 2006~~and a second issued in 2007 (the "2007 junior convertible trust preferred securities".) The principal terms of these securities ~~bear interest at a rate of 5.1% per annum, payable quarterly in cash. We~~ are ~~accreting the~~summarized below.

(1)

The carrying value is accreted to the principal amount at maturity using an interest rate of 7.5% (over ~~the~~its expected life of 30 years).

(2)

The ~~incremental interest expense for 2009~~carrying value is expected to be $1.0 million. Each $50 security is convertible, at any time, into 0.333 shares of our common stock, which represents a conversion price of $150 per share (or a 48% premium to the then prevailing share price of $101.45). Upon conversion, investors will receive cash or shares of our common stock (or a combination of cash and common stock) at our election. The 2006 junior convertible trust preferred securities may not be redeemed by us prior to April 15, 2011. On or after April 15, 2011, they may be redeemed if the closing price of our common stock exceeds $195 per share for a specified period of time. The trust's only assets are the junior convertible subordinated debentures. To the extent that the trust has available funds, we are obligated to ensure that holders of the 2006 junior convertible trust preferred securities receive all payments due from the trust.

In October 2007, we issued an additional $500 million of junior subordinated convertible debentures which are due 2037 to a wholly-owned trust simultaneous with the issuance, by the trust, of $500 million of convertible trust preferred securities to investors. The junior subordinated convertible debentures and convertible trust preferred securities (together, the "2007 junior convertible trust preferred securities") have substantially the same terms. In the fourth quarter of 2008, we repurchased $69.2 million aggregate principal amount of the 2007 junior convertible trust preferred securities. Following this repurchase, these securities were cancelled and retired.

~~The 2007 junior convertible trust preferred securities bear interest at 5.15% per annum, payable quarterly in cash. We are accreting the discounted amount~~accreted to the principal amount at ~~maturity. The incremental~~maturity using an interest ~~expense for 2009 is~~rate of 8.0% (over its expected ~~to be $1.3 million. Each $50 security is convertible, at any time, into 0.25 shares~~life of ~~our common stock, which represents a conversion price of $200 per share (or a 53% premium to the then prevailing share price of $130.77)~~30 years). Upon conversion, investors will receive cash or shares of our common stock (or a combination of cash and common stock) at our election. The 2007 junior convertible trust preferred securities may not be redeemed by us prior to October 15, 2012. On or after October 15, 2012, they may be redeemed if the closing price of our common stock exceeds $260 per share for a specified period of time. The trust's only assets are the 2007 junior convertible subordinated debentures. To the extent that the trust has available funds, we are obligated to ensure that holders of the 2007 junior convertible trust preferred securities receive all payments due from the trust.

(3)

The 2006 and 2007 junior convertible trust preferred securities are considered contingent payment debt instruments under the federal income tax regulations. We are required to deduct interest in an amount greater than our ~~reported interest expense. In 2009,~~cash coupon rate.

Both the 2006 and 2007 junior convertible trust preferred securities are convertible, at any time, into a defined number of shares. Upon conversion, holders will receive cash or shares of our common stock, or a combination thereof. We can call the 2006 junior convertible trust preferred securities on or after April 2011 if the closing price of our common stock exceeds $195 per share for a specified period of time.

We can call the 2007 junior convertible trust preferred securities on or after October 2012 if the closing price of our common stock exceeds $260 per share for a specified period of time.

Holders of the 2006 and 2007 junior trust preferred securities have no rights to put these ~~deductions will generate deferred taxes of approximately $8.8 million.~~securities to us.

~~In May 2008, we~~We have entered into athree forward equity sale ~~agreement~~agreements with a major securities ~~firm~~firms to sell ~~up to $200 million~~shares of our common stock ~~(the "May 2008 Agreement"), with the timing of sales in our~~

~~discretion.~~(up to $200 million under each agreement). Under the terms of ~~the May 2008 Agreement,~~these agreements, we can settle forward sales at any time prior to ~~March~~December 31, 2010 by issuing shares in exchange for cash. Alternatively, we may choose to settle forward sales on a net stock or cash basis. We

Through March 31, 2010, we have ~~sold all $200~~completed $496.5 million ~~under the May 2008 Agreement at a~~of forward sales. In March 2009, we settled $147.2 million of forward equity sales by issuing 1.8 million shares of our common stock. The weighted average exercise price of ~~$65.41 and have settled approximately $144.0 million~~our forward equity sales that remain unsettled is $57.54.

A summary of ~~these forward sales through the issuance of approximately 1.8 million shares.~~

~~In May 2009, we entered into a second~~our forward equity sale agreement to sell up to $200 million of our common stock (the "May 2009 Agreement"). We have sold all $200 million under the May 2009 Agreement at a weighted average exercise price of $57.27, but have not yet elected to settle the forward sales. Asagreements is the case in the May 2008 Agreement, we may choose to settle forward sales at any time by issuing shares in exchange for cash, or we may settle forward sales on a net stock or cash basis (prior to August 1, 2010).

In July 2009, we entered into a third forward equity sale agreement to sell up to $200 million of our common stock (the "July 2009 Agreement"). We have sold approximately $60 million under the July 2009 Agreement at a weighted average exercise price of $66.35, but have not yet elected to settle these forward sales. As is the case in the other agreements, we may choose to settle forward sales by issuing shares in exchange for cash, or we may settle forward sales on a net stock or cash basis (prior to December 31, 2010).

During the first quarter of 2008, we entered into a series of treasury rate lock contracts with a notional value of $250 million. These contracts were settled in the second quarter of 2008, and we received $8.2 million (each contract was designated and qualified as ~~a cash flow hedge). During the fourth quarter of 2008, we concluded that it was probable that the hedged~~follows:

Many of our operating agreements provide Affiliate managers a conditional right to require us to purchase their retained equity interests at certain intervals. Certain agreements also provide us a conditional right to require Affiliate managers to sell their retained equity interests to us upon their death, permanent incapacity or termination of employment and provide Affiliate managers a conditional right to require us to purchase such retained equity interests upon the occurrence of specified events. The purchase price of these conditional purchases are generally calculated based upon a multiple of the Affiliate's cash flow distributions, which is intended to represent fair value. Affiliate management partners are also permitted to sell their equity interests to other individuals or entities in certain cases, subject to our approval or other restrictions.

We may pay for Affiliate equity purchases in cash, shares of our common stock or other forms of consideration and can consent to the transfer of these interests to other individuals or entities. Our cumulative redemption obligation for these interests has been presented as "Redeemable non-controlling interests" on our Consolidated Balance Sheets. ~~Changes in redeemable non-controlling interests for the three and nine months ended September 30, 2009 are principally the result of changes to the value of these interests.~~ Although the timing and amounts of these purchases are difficult to predict, we expect to repurchase approximately ~~$50.0~~$100 million of Affiliate equity during the next twelve months, and, in such event, will own the cash flow associated with any equity repurchased.

Cash flow from operations generally represents Net Income plus non-cash charges for amortization, deferred taxes, equity-based compensation and depreciation, as well as increases and decreases in our consolidated working capital.

The ~~decrease~~increase in cash flows from operations for the ~~nine~~three months ended ~~September 30, 2009~~March 31, 2010 as compared to the ~~nine~~three months ended ~~September 30, 2008,~~March 31, 2009, resulted principally from ~~decreased~~increased Net Income of ~~$48.5~~$29.5 million and a decrease in settlements of liabilities of $51.0 million, partially offset by a decrease in collections of investment advisory fees receivable ~~and liabilities~~ of ~~$66.6 million and $27.1 million, respectively.~~$30.3 million.

We consolidated ~~$68.8~~$93.8 million and ~~$95.6~~$97.3 million of client assets held in partnerships controlled by our Affiliates as of December 31, ~~2008~~2009 and ~~September 30, 2009,~~March 31, 2010, respectively. ~~Purchases~~Sales of ~~$2.8~~$1.0 million ~~reduced~~and $0.3 million increased operating cash flow in the ~~first nine~~three months ended ~~September 30, 2008, while sales of client assets generated $0.3 million of operating cash flow in the nine months ended September 30, 2009.~~March 31, 2009 and March 31, 2010, respectively.

The net cash flow used in investing activities increased ~~$67.9~~$128.2 million for the ~~nine~~three months ended ~~September 30, 2009~~March 31, 2010 as compared to the ~~nine~~three months ended ~~September 30, 2008.~~March 31, 2009. This was primarily the result of an increase of ~~$78.4~~$127.7 million in investments in Affiliates in the current ~~period, partially offset by a decrease~~period.

As discussed above in Pending Investments, during the ~~purchase of fixed assets of $6.4 million.~~second quarter we completed our investment in Aston and plan to complete our investment in Pantheon.

Net cash flows ~~used in~~from financing activities increased ~~$26.5~~$178.2 million for the ~~nine~~three months ended ~~September 30, 2009,~~March 31, 2010, as compared to the ~~nine~~three months ended ~~September 30, 2008.~~March 31, 2009. This was primarily as a result of ~~a decrease in net proceeds from the issuance of senior convertible securities and settlement of convertible securities of $251.3 million and a decrease~~an increase in net senior bank debt ~~repayments~~activity of ~~$46.0~~$403.5 million, partially offset by $144.3 million received from settlements under our forward equity sale agreement in the first quarter of 2009 (as discussed above) and ~~a decrease~~an increase in ~~distributions to non-controlling interests and~~ repurchases of Affiliate equity of ~~$178.4~~$86.3 million.

~~During 2008, we retired~~Our investment in Artemis was financed through borrowings under our credit facility, and our investment in Aston was financed through the ~~outstanding floating rate convertible securities and issued~~issuance of approximately ~~7.0~~1.7 million shares of our common stock. ~~Additionally, we repurchased~~We plan to finance our investment in Pantheon with borrowings under our credit facility and $100 million of proceeds from the ~~outstanding senior notes component~~partial settlement of ~~our 2004 PRIDES. The repurchase proceeds were used by the original holders to fulfill their obligations under the related~~ forward equity ~~purchase contracts. We issued approximately 3.8 million shares of common stock to settle the forward equity purchase contracts.~~sales.

Under past acquisition agreements, we are contingently liable, upon achievement of specified financial targets, to make payments of up to ~~$293.9~~$378 million through 2012. In the remainder of ~~2009,~~2010, we do not expect to make ~~total~~any significant payments ~~of approximately $60 million~~ to settle portions of these contingent obligations.

Proceeds available under our Facility and forward equity sale agreements are sufficient to support our cash flow needs for the foreseeable future.

The following table summarizes our contractual obligations as of ~~September 30, 2009:~~March 31, 2010:

				Payments Due												Payments Due

Contractual Obligations	Contractual Obligations	Total		Remainder of 2009		2010-2011		2012-2013		Thereafter			Total			Remainder of 2010			2011-2012			2013-2014			Thereafter
(in millions)	(in millions)
Senior convertible securities		$	1,048.4	$	—	$	36.3	$	36.3	$	975.8
Junior convertible trust preferred
	securities⁽¹⁾		1,796.8		9.4		75.0		75.0		1,637.4
Senior bank debt													$	170.0		$	—		$	170.0		$	—		$	—
Senior convertible securities⁽¹⁾														1,027.9			9.1			36.3			36.3			946.2
Junior convertible trust preferred securities⁽²⁾														1,727.2			27.8			74.1			74.1			1,551.2
Leases	Leases		76.0		4.4		31.8		20.9		18.9			69.4			13.3			26.6			17.9			11.6
Other liabilities⁽²⁾⁽³⁾	Other liabilities⁽²⁾⁽³⁾		88.2		60.5		27.7		—		—	Other liabilities⁽²⁾⁽³⁾			18.3			18.3			—			—			—

Total		$	3,009.4	$	74.3	$	170.8	$	132.2	$	2,632.1
Total Contractual Obligations													$	3,012.8		$	68.5		$	307.0		$	128.3		$	2,509.0

Contingent Obligations
Contingent payment obligations⁽⁴⁾													$	80.3		$	—		$	80.3		$	—		$	—

In June 2009, the FASB issued guidance establishing new criteria that must be met before transfers of financial assets are eligible for sale accounting and changes the amount that can be recognized as a gain or loss on a transfer accounted for as a sale when beneficial interests are received by the transferor. Disclosures are also required to provide information about transfers of financial assets and a transferor's continuing involvement with transferred financial assets. We will adopt this new guidance inDuring the first quarter of 2010, ~~and~~ we ~~do not expect this~~adopted a new standard ~~to have a material effect on our consolidated financial statements.~~

~~In June 2009, the FASB issued guidance requiring~~that requires an enterprise to ~~qualitatively assess the determination of the primary beneficiary of~~perform a qualitative analysis to determine whether its variable interests give it a controlling financial interest in a variable interest entity ("VIE") ~~based on whether~~. Under the ~~entity~~standard, an enterprise has a controlling financial interest when it has (a) the power to direct the activities of a VIE that most significantly impact the entity's economic performance and ~~has~~(b) the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. ~~This guidance also requires an ongoing reconsideration of~~An enterprise that holds a controlling financial interest is deemed to be the primary beneficiary and ~~amends the events that trigger a reassessment of whether an entity~~ is ~~a VIE. Disclosures are also~~ required to ~~provide information about an enterprise's involvement in a~~consolidate the VIE. ~~We will adopt~~This new standard has been deferred for certain entities that utilize the specialized accounting guidance for investment companies or that have the attributes of investment companies. The adoption of the portions of this new ~~guidance in~~standard that were not deferred did not have a material impact on our Consolidated Financial Statements.

During the first quarter of 2010, we adopted a new standard that eliminated the concept of a qualifying special-purpose entity ("QSPE"), changed the requirements for derecognizing financial assets, and werequired additional disclosures to enhance information reported to users of financial statements by providing greater transparency about transfers of financial assets, including an entity's continuing involvement in and exposure to the risks related to transferred financial assets. The standard also clarified the requirements for isolation and limitations on portions of financial assets that are ~~currently evaluating the potential impact~~eligible for sale accounting. The adoption of this new ~~standard.~~

In June 2009, the FASB issued guidance that replaces all previously issued accounting standards and establishes the "FASB Accounting Standards Codification™" (the "Codification") as the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with generally accepted accounting principles in the United States. The Codification does not change Generally Accepted Accounting Principles and doesstandard did not have ~~an effect~~a material impact on our ~~financial results.~~Consolidated Financial Statements.

As of September 30, 2009, the carrying value of goodwill was $1,406.6 million. Goodwill represents the excess of the purchase price of acquisitions over the fair value of identified assets and liabilities.

Our goodwill impairment tests are performed annually during the third quarter at the reporting unit level (in our case, our three operating segments), or more frequently, should circumstances suggest fair value has declined below the related carrying amount. We completed our annual goodwill impairment test during the third quarter and no impairments were identified. For purposes of our test, the fair value of each reporting unit was measured by applying a multiple to the estimated cash flow of the reporting unit, including cash flows attributable to non-controlling interests. Management believes that the valuation inputs used to determine fair value of our reporting units are reasonable.

The fair value of each of our reporting units substantially exceeds their respective carrying values; the fair values of the Mutual Fund, Institutional and High Net Worth reporting units are approximately 40%, 180%, and 60% greater than their respective carrying values. Accordingly, only a decline in the value of any of our reporting units in excess of approximately 40% would require us to reassess the need for an impairment charge.

There have been no significant changes to our Quantitative and Qualitative Disclosures About Market Risk in the three months ended ~~September 30, 2009.~~March 31, 2010. Please refer to Item 7A in our ~~2008~~2009 Annual Report on Form 10-K.

We carried out an evaluation under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures during the quarter covered by this Quarterly Report on Form 10-Q. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of the end of the quarter covered by this Quarterly Report on Form 10-Q, our disclosure controls and procedures are effective in ensuring that (i) the information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934, as amended (the "Exchange Act") is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and (ii) such information is accumulated and communicated to our management, including our principal executive officer and principal financial officers as appropriate to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, we recognize that any controls and procedures, no matter how well designed and operated, can provide only reasonable

assurance of achieving the desired control objectives, and our management necessarily was required to apply its judgment in evaluating and implementing possible controls and procedures. ~~Based upon that evaluation,~~Our disclosure controls and procedures were designed to provide reasonable assurance of achieving their stated objectives and our ~~Chief Executive Officer~~principal executive officer and ~~Chief Financial Officer~~principal financial officers concluded that ~~as of September 30, 2009,~~ our disclosure controls and procedures are effective ~~to ensure that information required to be disclosed by us in~~at the reports that we file or submit under the Securities Exchange Act of 1934, as amended, is accumulated and communicated to our management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.reasonable assurance level. We ~~continue to~~ review on an ongoing basis and document our disclosure controls and procedures, and our internal control over financial reporting, and we may from time to time make changes ~~aimed at enhancing~~in an effort to enhance their effectiveness and ~~ensuring~~ensure that our systems evolve with our business.

~~There was no~~No change in our internal control over financial reporting ~~that~~(as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the quarter covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

The exhibits are listed on the Exhibit Index and are included elsewhere in this Quarterly Report on Form 10-Q.

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


ý		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended ~~September 30, 2009~~March 31, 2010
OR
o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to


Delaware		04-3218510
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification Number)


Large accelerated filer ý		Accelerated filer o		Non-accelerated filer o (Do not check if a smaller reporting company)		Smaller reporting company o

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,

	2008		2009		2008		2009
Purchase of investments	$	239,240	$	84,808	$	460,136	$	368,641
Sale of investments		243,106		84,808		457,346		368,972
Gross subscriptions		184		—		4,436		650
Gross redemptions		1,851		—		2,447		1,121

				Weighted Average Exercise Price

Unexercised options outstanding—January 1, 2009		5,250,137		$	48.38	4.5
	Options granted	534,645			61.18
	Options exercised	(790,647	)		37.95
	Options expired	(22,500	)		45.67
	Options forfeited	(27,949	)		68.25

Unexercised options outstanding—September 30, 2009		4,943,686			51.33	4.5

Exercisable at September 30, 2009		3,280,725			48.47	4.2

Agreement	Amount Sold		Amount Settled		Amount Unsettled⁽¹⁾

May 2008	$	200,000	$	147,170	$	52,830
May 2009		200,000		—		200,000
July 2009		96,500		—		96,500

	$	496,500	$	147,170	$	349,330

		December 31, 2008			September 30, 2009

Deferred assets (liabilities):
	Intangible asset amortization	$	(185,376	)	$	(187,485	)
	Convertible securities interest		(124,805	)		(135,591	)
	Non-deductible intangible amortization		(18,277	)		(19,853	)
	State net operating loss carryforwards		31,259			29,495
	Deferred compensation		4,643			5,620
	Fixed asset depreciation		(3,626	)		(3,644	)
	Accrued expenses		4,739			4,027
	Capital loss carryforwards		922			1,808
	Foreign tax credit carryforwards		—			6,401
	Deferred income		3,211			3,079

			(287,310	)		(296,143	)
Valuation allowance			(32,181	)		(27,165	)

Net deferred income taxes		$	(319,491	)	$	(323,308	)

			Fair Value Measurements

	September 30, 2009		Fair Value Measurements
Financial Assets	September 30, 2009		Level 1		Level 2		Level 3
Affiliate investments in partnerships	$	95,587	$	91,374	$	28	$	4,185
Affiliate investments in marketable securities		16,574		14,308		2,266		—

				Weighted Average Exercise Price

Unexercised options outstanding— January 1, 2010		5,166,344		$	54.29
	Options granted	3,125			71.13
	Options exercised	(63,233	)		41.99
	Options forfeited	(2,854	)		44.57

Unexercised options outstanding— March 31, 2010		5,103,382			54.45	4.5

Exercisable at March 31, 2010		3,237,416			51.58	4.2

	Mutual Fund		Institutional		High Net Worth		Total

Balance, as of December 31, 2008	$	463,421	$	559,511	$	220,651	$	1,243,583
Goodwill acquired, net		93,780		25,373		15,248		134,401
Foreign currency translation		12,673		12,561		3,397		28,631

Balance, as of September 30, 2009	$	569,874	$	597,445	$	239,296	$	1,406,615

	Mutual Fund		Institutional		High Net Worth		Total

Balance, as of December 31, 2009	$	561,753	$	602,962	$	248,502	$	1,413,217
Goodwill acquired		93,688		5,811		44		99,543
Foreign currency translation		634		4,605		3,223		8,462

Balance, as of March 31, 2010	$	656,075	$	613,378	$	251,769	$	1,521,222

Consideration

Purchase price	$	157,838
Contingent payment obligation		24,973

Purchase Price	$	182,811

Acquired client relationships, net	$	238,666
Tangible assets, net		42,261
Deferred income taxes		(66,826	)
Non-controlling interests		(130,833	)
Goodwill		99,543

	$	182,811


Balance as of January 1, 2010	$	368,999
Issuance of Redeemable non-controlling interest		6,703
Repurchase of Redeemable non-controlling interest		(17,911	)
Changes in redemption value		10,911

Balance as of March 31, 2010	$	368,702

(in billions)			Mutual Fund			Institutional			High Net Worth			Total

June 30, 2009			$	35.2		$	111.9		$	26.7		$	173.8
	Client cash inflows			2.3			5.5			1.6			9.4
	Client cash outflows			(2.3	)		(6.7	)		(1.5	)		(10.5	)

		Net client cash flows		—			(1.2	)		0.1			(1.1	)

	New investments			2.7			1.7			1.2			5.6
	Investment performance			5.5			16.9			3.0			25.4
	Other⁽¹⁾			(0.3	)		(1.9	)		(2.2	)		(4.4	)

September 30, 2009			$	43.1		$	127.4		$	28.8		$	199.3

(in billions)			Mutual Fund			Institutional			High Net Worth			Total

December 31, 2008			$	34.7		$	109.4		$	26.0		$	170.1
	Client cash inflows			5.7			20.7			4.2			30.6
	Client cash outflows			(8.0	)		(24.9	)		(4.8	)		(37.7	)

		Net client cash flows		(2.3	)		(4.2	)		(0.6	)		(7.1	)

	New investments			2.7			1.7			1.2			5.6
	Investment performance			8.3			27.0			4.5			39.8
	Other⁽¹⁾			(0.3	)		(6.5	)		(2.3	)		(9.1	)

September 30, 2009			$	43.1		$	127.4		$	28.8		$	199.3

(in billions)			Mutual Fund			Institutional			High Net Worth			Total

December 31, 2009			$	44.5		$	133.9		$	29.6		$	208.0
	Client cash inflows			3.0			6.6			1.7			11.3
	Client cash outflows			(2.7	)		(8.6	)		(1.5	)		(12.8	)

		Net client cash flows		0.3			(2.0	)		0.2			(1.5	)

	New Investments			13.5			2.2			—			15.7
	Other⁽¹⁾			—			(0.1	)		—			(0.1	)
	Investment performance			2.2			6.6			1.2			10.0

March 31, 2010			$	60.5		$	140.6		$	31.0		$	232.1

	Zero Coupon Convertible Notes			2008 Convertible Notes

Issue Date		May 2001			August 2008
Maturity Date		May 2021			August 2038
Par Value	$	47.4		$	460.0
Carrying Value	$	47.4		$	409.6	⁽¹⁾
Note Denomination		945			1,000
Current Conversion Rate		17.429			7.959
Current Conversion Price	$	54.28		$	125.65
Stated Coupon		—			3.95	%
Tax Deduction Rate		0.50	%		9.38%	⁽²⁾

	2006 Junior Convertible Trust Preferred Securities			2007 Junior Convertible Trust Preferred Securities

Issue Date		April 2006			October 2007
Maturity Date		April 2036			October 2037
Par Value	$	300.0		$	430.8
Carrying Value	$	212.5	⁽¹⁾	$	294.9	⁽²⁾
Note Denomination		50			50
Current Conversion Rate		0.333			0.250
Current Conversion Price	$	150.00		$	200.00
Stated Coupon		5.10	%		5.15	%
Tax Deduction Rate		7.50%	⁽³⁾		8.00%	⁽³⁾

Agreement	Amount Sold		Amount Settled		Amount Unsettled⁽¹⁾

May 2008	$	200.0	$	147.2	$	52.8
May 2009		200.0		—		200.0
July 2009		96.5		—		96.5

	$	496.5	$	147.2	$	349.3


		AFFILIATED MANAGERS GROUP, INC. (Registrant)
~~November 9, 2009~~May 10, 2010
		/s/ DARRELL W. CRATE Darrell W. Crate on behalf of the Registrant as Executive Vice President, ~~President,~~ Chief Financial Officer and Treasurer (and also as Principal Financial and Principal Accounting Officer)

Exhibit No.			Description

	~~31.1~~2.1		Purchase and Sale Agreement by and among Frank Russell Company, The Northwestern Mutual Life Insurance Company (solely with respect to Section 4.18 and Section 4.19) and Affiliated Managers Group, Inc. dated as of February 10, 2010.*
	10.1		Third Amended and Restated Credit Agreement, dated as of November 27, 2007, by and among Affiliated Managers Group, Inc., Bank of America, N.A., as administrative agent, and the several lenders from time to time parties thereto, and the schedules and exhibits thereto effective as of November 27, 2007.
	31.1		Certification of Registrant's Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	31.2		Certification of Registrant's Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
	32.1		Certification of Registrant's Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	32.2		Certification of Registrant's Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.