Oct. 29 (Bloomberg) -- Lazard Ltd., the investment bank led by Bruce Wasserstein, said profit dropped 34 percent on expenses related to purchasing the part of its asset-management unit the firm didn't already own.

Third-quarter earnings fell to $54.8 million, or 44 cents a share, from $83.6 million, or 73 cents, a year earlier, the company said today in a statement. That compared with the 47-cent average estimate of 9 analysts surveyed by Bloomberg.

Lazard's benefited as the value of takeovers the firm advised on rose 13 percent to $106.9 billion from a year earlier, data compiled by Bloomberg show. Competitors Morgan Stanley and Merrill Lynch & Co. reported lower deal-related revenue in the quarter.

Lazard in August agreed to buy the 23 percent of its asset- management unit it didn't own for $240 million. The firm said at the time that it had an expense of about $183 million for severance costs related to the deal. Total announced deals globally this year dropped 10 percent to $2.83 trillion as corporate takeovers slowed.

Lazard rose $3.95 to $30.20 in New York Stock Exchange composite trading yesterday. The shares dropped 26 percent this year through yesterday, compared with a 3.4 percent decline for rival Greenhill & Co. and a 44 percent drop for Evercore Partners Inc.

Wasserstein, a former corporate lawyer, rose to the top ranks of merger advisers during the 1980s, helping run investment banking at First Boston Corp., now part of Credit Suisse Group. In 1988, he left with Joseph Perella to found Wasserstein, Perella & Co., an advisory firm that he sold to Germany's Dresdner Bank AG for $1.56 billion in January 2001.

Michel David-Weill, a descendant of Lazard's founding family, hired Wasserstein in 2001 to revive the company. Wasserstein recruited more bankers and, over David-Weill's objections, sold shares in the firm to the public for the first time in May 2005 for $25 each.

To contact the reporters on this story: Josh Fineman in New York at jfineman@bloomberg.net.

Last Updated: October 29, 2008 07:03 EDT