PEOPLE : Linen to Head Shearson Brokerage Unit

Shearson Lehman Hutton Inc. has named Jonathan Linen, an executive from parent American Express Co., to head Shearson’s brokerage and money management businesses.

The move appears to confirm American Express’ plan to split Shearson in two as part of a restructuring of the troubled financial services company.

New York-based Shearson, the nation’s second-largest securities firm after Merrill Lynch & Co., said Linen will become president and chief executive of its Private Client Group, which is its brokerage unit, and asset management business.

Linen was most recently head of the travelers checks and direct marketing group of American Express. He has been with the firm for 21 years.

“The move reaffirms American Express’ commitment to developing the tremendous potential of Shearson’s retail franchise,” said James Robinson III, chairman and chief executive of American Express.

Hardwick Simmons, who was president of the brokerage group, has resigned, Shearson said.

As part of the reorganization, American Express plans to buy the Shearson stock that it does not already own, about 39% of its shares.

It has already installed new senior management. In January, Shearson Chairman Peter Cohen was ousted and replaced by Howard Clark Jr., who was American Express’ chief financial officer.

Clark has since announced that the firm would overhaul its business, resulting in about 2,000 layoffs. The cost of these and other changes contributed to the firm’s first-quarter loss of $915 million.

Sources at Shearson and on Wall Street have indicated for weeks that the firm was planning to split itself into two businesses, combining the brokerage and money management areas and forming a separate unit from investment banking and capital markets.

In its brokerage business, Shearson has 10,000 brokers at 450 offices around the country managing about $90 billion for pension funds and other institutions and $180 billion for private clients.

Shearson said Joseph Plumeri Jr., who heads the domestic branches, and Henry Gottmann, head of sales and marketing for individual retail accounts, will continue in their current roles. In addition, Jerome Miller will continue to direct the asset management business, it said.

Linen, 46, joined American Express in 1969 as assistant to the chairman. After holding several domestic and overseas posts, he was named a senior vice president in 1978.

From 1980 through 1986, he served as president of the domestic Travel Services division and then became president of direct marketing in the United States.