Legg Mason Inc., the money manager that’s struggled with more than five years of net redemptions, agreed to buy Martin Currie to expand into active international stock funds. Terms weren’t disclosed.

Martin Currie, founded in 1881 as an accountancy partnership, will add $9.8 billion in assets, Baltimore-based Legg Mason said today in a statement. The acquisition of Edinburgh-based Martin Currie, which will operate as a separate affiliate, is set to close in the fourth quarter.

Legg Mason adds Martin Currie to its lineup of independent investment affiliates including stock investor ClearBridge Advisors, fixed-income manager Western Asset Management and QS Investors, the global quantitative equity firm Legg Mason bought this year. Chief Executive Officer Joseph A. Sullivan, who took over in 2013 as shares were more than 80 percent below their pre-crisis peak, said in March he’s seeking to acquire new investment units and improve performance.

“We have been clear about what we’re trying to do and we have been executing on that,” Sullivan said in a telephone interview. “Our real focus from here just turns to growth.”

New Contracts

Legg Mason rose 0.7 percent to $51.01 as of 9:47 a.m. in New York. The shares have climbed 17 percent this year through yesterday including reinvested dividends, compared with 2.7 percent for the Standard & Poor’s 20-company index of asset managers and custody banks.

Legg Mason’s $2.5 billion Australian Equities unit will become part of Martin Currie. Martin Currie’s management team signed new long-term contracts as part of the transaction.

“We have a global distribution footprint and yet we had a key gap that we were not able to offer our global clients,” Sullivan said.

Sullivan said in March that 2014 will be a year of growth for the firm as it seeks to add new investment units, with non-U.S. equities being the top priority. The firm hired Wells Fargo & Co.’s Thomas Hoops in January to look for potential acquisitions and develop products.

Legg Mason made its first major purchase since 2005 last year with fund-of-hedge-funds business Fauchier Partners, which contributed about $5 billion in assets to its Permal unit. In March, it agreed to spend as much as $41 million to buy QS, which split from Deutsche Bank AG in 2010 and had $4.1 billion in funds under management and $100 billion in advisory assets. Each affiliate operates independently with separate revenue-sharing agreements.

“We really like our lineup as it is now,” Sullivan said. “I wouldn’t expect more mergers or anything like that.”

Legg Mason managed $704.3 billion as of June 30, up 9.3 percent from a year earlier. While that’s down from a peak of $1 trillion in 2007, it’s a rebound from about $612 billion in September 2011.