<PAGE>
Project Reunion
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Valuation Materials
July, 2000
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MORGAN STANLEY DEAN WITTER
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Project Reunion
<TABLE>
<CAPTION>
Summary Valuation
====================================================================================================================
Indicative Valuation of Reunion
($ in millions)
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I. Indicative Public Market Trading Valuation
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A. Equity Value Basis
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Basis Comparables Trading Range Relevant Multiple Range Implied Value Range
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<S> <C> <C> <C> <C>
2000E I/B/E/S Median EPS $0.86 12.5x - 17.5 x 12.5 x - 14.5 x $10.75 - $12.47
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2001E I/B/E/S Median EPS 1.00 11.0 - 16.0 11.0 - 13.5 11.00 - 13.50
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2000E Management EPS $0.80 12.5x - 17.5 x 12.5 x - 14.5 x $10.00 - $11.60
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2001E Management EPS 0.87 11.0 - 16.0 11.0 - 13.5 9.57 - 11.75
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2000E MSDW EPS $0.78 12.5x - 17.5 x 12.5 x - 14.5 x $9.78 - $11.34
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2001E MSDW EPS 0.82 11.0 - 16.0 11.0 - 13.5 9.04 - 11.10
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Indicative Equity Value Range $10.00 - $11.50
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B. Aggregate Value Basis
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Basis Comparables Trading Range Relevant Multiple Range Implied Value Range
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LTM EBITDA $112 6.50x - 10.00 x 6.50 x - 8.50 x $728 - $952
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AUM $66,029 1.20% - 2.50 % 1.20 % - 1.60 % $792 - $1,056
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Indicative Aggregate Value Range $750 - $1,000
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Less Net debt (3/31/00) $181 $181
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Indicative Equity Value Range $569 - $819
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Indicative Value Per Diluted Share $11.00 - $15.00
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II. Indicative Minority Squeeze-out Premium Valuation
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Public Market Trading Range: $ 10.50 - $ 12.50
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Premium: 10.0% 11.55 - 13.75
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20.0% 12.60 - 15.00
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30.0% 13.65 - 16.25
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Indicative Reference Range $12.50 - $14.50
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</TABLE>
MORGAN STANLEY DEAN WITTER 1
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Project Reunion
<TABLE>
<CAPTION>
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Summary Valuation (cont'd)
==================================================================================================================
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Indicative Valuation of Reunion (cont'd)
($ in millions)
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III. Indicative Premiums Paid in Squeeze-Out Transactions
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Basis Acquisition Premium Range Relevant Premium Range Implied Value Range
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<S> <C> <C> <C> <C>
Reunion Unaffected Share Price $10.25 15.0%- 40.0% 20.0 % - 40.0% $12.30 - 14.35
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IV. Indicative Premiums Paid in Precedent Mergers & Acquisitions
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Basis Acquisition Multiples Range Relevant Multiple Range Implied Value Range
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LTM EBITDA $112 10.0x - 16.0x 8.0 x - 12.0x $896 - $1,344
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AUM $66,029 1.3% - 3.5% 1.2% - 1.5% $792 - $990
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Indicative Aggregate Value Range $850 - $1,100
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Less Net debt (3/31/00, plus Earn-outs of $57.5MM Payable in 2000) $239 $239
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Indicative Equity Value Range $612 - $862
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Indicative Value Per Diluted Share $11.00 - $16.00
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V. Discounted Cash Flow Indicative Range
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Indicative Reference Range $13.50 - $15.50
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VI. Indicative Reference Range
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</TABLE>
MORGAN STANLEY DEAN WRITER 2
<PAGE>
<TABLE>
<CAPTION>
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Project Reunion
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Valuation Matrix
=============================================================================================================
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Valuation Matrix
$ in millions, except per share data
Premium/Discount to Price as a multiple of
--------------------------------------- ----------------------------------------------------------------------
Equity Value Equity 60 Day Ave. 52-week/(1)/ 52-week/(1)/ I/B/E/S Median Earnings Management Earnings LTM EBITDA 6/30/2000
----------------------- -------------------
per Share Value Unaffected high low 2000E 2001E 2000E 2001E ($MM) AUM ($MM)
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<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
$10.25 $10.25 $6.31 $0.86 $1.00 $0.80 $0.87 $112 $66,029
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$5.00 $291 (51.2) % (51.2) % (20.8) 5.8 x 5.0 x 6.3 x 5.7 x 4.01 % 0.68 %
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6.00 349 (41.5) (41.5) (4.9) 7.0 6.0 7.5 6.9 4.49 0.76
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7.00 407 (31.7) (31.7) 10.9 8.1 7.0 8.8 8.0 4.97 0.84
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8.00 465 (22.0) (22.0) 26.8 9.3 8.0 10.0 9.2 5.45 0.93
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9.00 524 (12.2) (12.2) 42.6 10.5 9.0 11.3 10.3 5.93 1.01
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10.00 582 (2.4) (2.4) 58.5 11.6 10.0 12.5 11.5 6.41 1.09
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11.00 640 7.3 7.3 74.3 12.8 11.0 13.8 12.6 6.89 1.17
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12.00 698 17.1 17.1 90.2 14.0 12.0 15.0 13.8 7.37 1.25
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13.00 756 26.8 26.8 106.0 15.1 13.0 16.3 14.9 7.85 1.33
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14.00 815 36.6 36.6 121.9 16.3 14.0 17.5 16.1 8.33 1.41
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15.00 873 46.3 46.3 137.7 17.4 15.0 18.8 17.2 8.81 1.50
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16.00 931 56.1 56.1 153.6 18.6 16.0 20.0 18.4 9.29 1.58
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17.00 989 65.9 65.9 169.4 19.8 17.0 21.3 19.5 9.76 1.66
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18.00 1,047 75.6 75.6 185.3 20.9 18.0 22.5 20.7 10.24 1.74
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19.00 1,105 85.4 85.4 201.1 22.1 19.0 23.8 21.8 10.72 1.82
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20.00 1,164 95.1 95.1 217.0 23.3 20.0 25.0 23.0 11.20 1.90
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</TABLE>
3
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Project Reunion
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Selected Asset Management Transactions
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Selected Precedent Transactions
Asset Management
================================================================================
<TABLE>
<CAPTION>
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Approx. Agg Mult. Mult of Mult. of
Date Acquiror/ AUM Consid of LTM LTM Net % of Business of
Announced Target ($ Bn) ($ MM) LTM Rev EBITDA Income AUM Acquired Company
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<S> <C> <C> <C> <C> <C> <C> <C> <C>
One of the largest value-oriented
institutional managers in the
06/20/00 Alliance Capital/Sanford Bernstein $86.0 $3,500.0 NA 10.9 19.4 4.1 industry. Also has large private
client portfolio. Touted for its
high quality investment research.
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A holding company for 41 asset
managers. Primarily an
06/19/00 Old Mutual/UAM 188.0 2,181.0 2.4 7.1 34.1 1.2 institutional manager, the
majority invested in domestic
equities.
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Publicly traded limited
partnership, the operating
partnership owns 12 independent
06/16/00 Caisse des Depots et 134.0 2,200.0 3.4 12.3 21.8 1.6 inv. management firms and six
Cosignations/Nvest Lp distribution and consulting
firms. Primarily institutional
assets.
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Investment advisor to three
retail mutual fund families,
06/12/00 Liberty Financial/Wanger(1) 8.8 450.0 NA NA NA 5.1 including the Acorn Family
of Funds.
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Retail mutual fund manager,
05/15/00 UniCredito/Pioneer Group 24.4 1,228.0 6.0 18.0 35.7 5.1 majority invested in domestic
equities
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6th largest mutual fund company
in Canada, managing a range of 33
05/09/00 AMVESCAP/Trimark 16.6 1,636.0 4.5 10.7 28.4 9.9 mutual funds and 23 segregated
insurance funds
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Provides banking, investment
banking, and asset management
04/11/00 Chase Manhattan/Fleming Holdings(2) 97.6 4,100.0 NA 19.6 31.4 4.2 services
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JV managed non-U.S. investments
for institutional clients and 13
04/11/00 T. Rowe Price/Fleming JV 21.1 780.0 NA NA 38.6 3.7 T. Rowe Price sponsored mutual
funds
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U.K.'s fifth largest pension fund
manager and seventh largest
03/30/00 Nationwide Financial/Gartmore 85.0 1,640.0 NA NA NA 1.9 retail manager; operations in
U.S., Japan, and Germany
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9th largest institutional
03/10/00 Legg Mason/Perigee 14.2 208.4 7.4 12.1 22.5 1.5 investment management firm in
Canada.
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Manages 13 funds, including
several international equity
02/29/00 ReliaStar/Lexington 3.6 47.5 2.5 N.A. 174.0 1.3 funds, for retail investors,
institutions and individuals.
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Premier fixed income manager with
Total Return Fund managed by Bill
11/01/99 Allianz/PIMCO (70%) 254.6 3,216.0 5.0 16.0 22.8 1.8 Gross. Approximately 66%
institutional, remainder retail
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Manages 13 funds, includings
several international equity
02/29/00 ReliaStar/Lexington 3.6 47.5 2.5 N.A. 174.0 1.3 funds, for retail investors,
institutions and individuals.
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Bermuda-based international asset
manager serving 1100 private
09/15/99 UBS/Global Asset Management 13.9 700.0 N.A. 18.5 24.5 5.0 clients and 150 institutitional
clients
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Manages, markets, and distributes
07/22/99 Reliastar/Pilgrim 7.6 231.6 4.5 9.0 18.1 3.0 open- and closed-end mutual funds
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Strong retail and high-net worth
07/06/99 Credit Suisse/Warburg Pincus 22.0 650.0 N.A. N.A. N.A. 3.0 business
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Investment firm with individual
05/13/99 Wachovia/Offitbank 11.0 203.0 4.9 22.0 43.0 1.8 clients in 39 states, Latin
America, Europe, Asia
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UK unit trust manager with
03/11/99 Prudential UK/M&G Group 29.8 3,100.0 N.A. N.A. 35.3 10.4 improving investment performance
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</TABLE>
Notes: (1) Consideration includes a $170MM earn-out provision
(2) Financial information is for asset management stand-alone
(3) BOA purchased initial 50% for $150 and remaining 50% for $950MM
(4) Based on $950 for 50%
MORGAN STANLEY DEAN WITTER 4
<PAGE>
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Project Reunion Selected Asset Management Transactions
Selected Precedent Transactions
Asset Management
===========================================================
<TABLE>
<CAPTION>
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Approx Agg Mult. Mult of Mult. of
Date Acquiror/ AUM Consid of LTM LTM Net % of Business of
Announced Target ($ Bn) ($ MM) LTM Rev EBITDA Income AUM Acquired Company
---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
12/15/98 Phoenix Investment 4.4 164.0 2.8 14.6 17.7 3.7 Family of mutual funds
Partners/Zweig and closed-end funds
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08/30/98 Northwestern 41.0 900.0-1200.0 N.A. 15.0-20.0 N.A. 2.2-2.9 Investment management
Mutual / Frank and consulting
Russell
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11/19/97 Merrill Lynch/ 177.0 5,230.0 8.1 17.5 25.4 3.0 Domestic and
Mercury Asset international fixed
Management income and equity
fund to institutional
and retail clients
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08/15/97 Affiliated 5.0 300.0 9.3 12.9 13.5 6.0 AMG will pay more than
Managers Group/ $100 million for 71.2%
Tweedy Browne of firm owned by
& Co. (71.2%) brothers Will and
Chris Browneand John
Spears. 30% will be
held by insiders.
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08/13/97 Fleet Financial 22.0 635.0 (1) N.A. 10.0 N.A. 2.9 68% institutional; 32%
Group/ Columbia retail; 12 mut. funds,
Management Co. 5 with Morningstar 4
star ratings
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02/14/97 PIMCO Advisors, 48.0 265.0 4.7 11.2 N.A. 1.7 A leading investment
L.P./ Oppenheimer management firm,
Capital well-known for its
value-based investment
disciplines, primarily
in equity management,
serving a broad range
of institutional
clients, including
public and private
funds, foundations,
endowments and
individuals.
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11/14/96 Invesco PLC/ 57.1 1,600.0 4.8 9.7 19.0 2.8 Manager of
AIM Management Constellation and Value
Group Funds. One of the
fastest growing fund
groups in the U.S.
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06/24/96 Franklin 17.0 851.0 (2) 8.5 12.4 13.0 5.0 An equity mutual fund
Resources, Inc./ manager 100% owned by
Heine Securities Michael Price
Corp.
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06/24/96 Morgan Stanley 57.0 1,175.0 3.7 10.5 (3) 17.5 2.1 Investment management
Group, Inc./ company with the fifth
VKAC Holding, largest non-
Inc. proprietary fund group
sold by financial
representatives
nationwide.
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Mean 5.0 13.4 39.5 3.6
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Median 4.7 12.3 24.5 3.0
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</TABLE>
Notes
1. Consideration includes a $170MM earn-out provision
2. Financial information is for asset management
stand-alone
3. BOA purchased initial 50% for $150 and remaining 50% for
$950MM
4. Based on $950 for 50%
MORGAN STANLEY DEAN WITTER
5
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<TABLE>
<CAPTION>
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Project Reunion
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Trading Comparison of Selected Asset Management Companies /(1)/
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Trading Comparison of Selected Asset Management Companies/(1)/
($MM, except per-share data)
Current Est. Price as a Multiple of Agg. Value/
---------------------- ---------------
Market Share Price as a % of LTM 5 Yr. Div. 2000E 2001E LTM
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Company AUM Value Price High Low Growth Yld. EPS/(2)/ EPS/(2)/ EBITDA/(2)/ AUM
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<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
U.S. Mutual Funds
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Franklin Resources $233,400 $7,519 $30.68 71.1% 125.4% 15.2% 0.8% 13.2x 11.8x 9.0x 2.9%
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T. Rowe Price 179,900 5,034 41.69 86.8 161.1 15.5 1.2 18.7 17.4 9.5 2.6
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AMVESCAP 391,600 10,538 78.06 99.8 216.8 19.5 1.0 21.6 18.7 16.2 2.9
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Eaton Vance 41,800 1,665 46.68 95.7 171.5 20.0 0.8 14.9 13.3 9.4 3.4
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Federated Investors 125,363 2,788 34.88 98.1 226.8 17.4 0.5 19.4 17.0 10.0 1.9
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John Nuveen Company 59,965 1,277 40.81 93.4 121.8 10.0 2.8 12.8 11.8 7.3 2.2
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Waddell & Reed 41,480 2,638 32.13 90.2 238.7 15.3 1.1 20.1 17.8 14.3 6.7
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Neuberger Berman 55,470 2,312 47.00 96.9 198.9 12.2 0.9 16.5 14.9 8.8 4.2
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Mean 91.5% 182.7% 15.6% 1.1% 17.2x 15.3x 10.6x 3.3%
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Median 94.5 185.3 15.4 0.9 17.6 16.0 9.5 2.9
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U.S. Institutional
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United Asset Management $188,000 $1,161 $20.56 84.8% 149.5% 12.5% 3.9% 16.9x 16.1x 6.3x 1.0%
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Phoenix Investment Partners 66,029 457 10.31 99.4 163.4 NA 3.1 12.0 10.3 6.4 1.1
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Affiliated Managers Group 91,600 964 43.44 85.2 197.4 23.0 0.0 17.2 14.1 6.0 1.3
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Blackrock 172,600 2,084 32.63 90.6 261.0 16.3 0.0 25.3 21.6 14.2 1.2
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Mean 90.0% 192.8% 17.3% 1.7% 17.8x 15.5x 8.2x 1.1%
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Median 87.9 180.4 16.3 1.6 17.0 15.1 8.3 1.1
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Limited Partnerships
--------------------
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Alliance Capital Management $394,200 $8,172 $47.38 94.0% 195.4% 21.0% 5.3% 15.5x 13.6x 15.1x 2.0%
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Nvest 134,000 888 20.00 52.1 142.9 NA 9.2 11.8 10.1 6.3 0.8
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Mean 73.1% 169.1% 21.0% 7.2% 13.6x 11.8x 10.7x 1.4%
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Median 73.1 169.1 21.0 7.2 13.6 11.8 10.7 1.4
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</TABLE>
Notes:
1. Market data as of 6/29/2000. Financial data from latest 10-K or 10-Q.
2. Based on I/B/E/S estimates as of 6/29/2000. Earnings estimates calendarized
for fiscal year ending 12/31. Aggregate values calculated as market value
plus debt less cash.
6
