Bill Miller is severing ties with Legg Mason after more than three decades.

The stock picker, famed for beating the S&P 500 Index for 15 straight years when he ran the Legg Mason Value Trust, will buy Legg Mason’s stake in LMM, an investment adviser that he and the company jointly own, according to a statement released today. LMM oversees $1.8 billion in assets, including the $1.3 billion Legg Mason Opportunity Trust, the Miller Income Opportunity Trust and related strategies.

It will be the first time that Miller, 66, runs a business that is entirely his own, though he has been moving in this direction for several years. While he spends much of his time at his residence in Vero Beach, Florida, he continues to be actively involved in money management, having recently started his first hedge fund, one that will employ computer models designed to predict earthquakes to help forecast potential stock market crashes.

“We often would get a lot of questions on whether Bill was ready to retire,” said Samantha McLemore, who has worked on the Opportunity Trust since 2002, and now serves as co-portfolio manager. “One thing this should make clear is that he is investing more in the business and has all plans and intentions to stick around.”

The terms of the buyout weren’t disclosed. The transaction isn’t material to Legg Mason, according to Mary Athridge, a spokeswoman for the firm. The company oversees about $757 billion in assets.

Household Name

Miller is one of the few remaining household names in money management, a stock picker who, like Fidelity’s Peter Lynch, made his reputation during a period of fast growth for the industry. He employed alternative approaches that led him into stocks shunned by some value oriented peers.

Miller joined Legg Mason in 1981 as director of research, after getting degrees from Washington & Lee University and Johns Hopkins University, and working as treasurer of the J.E. Baker Co. He began running its first mutual fund, the Value Trust, the following year with the late Ernie Kiehne. Miller eventually became sole portfolio manager for the Value Trust and emerged as a star stock picker when the fund beat the market every year from 1991 through 2005.

Miller became mired in the worst slump of his career during the 2008 financial crisis, when the Value Trust lost 55 percent. As he continued to trail the benchmark S&P 500, the Value Trust’s assets tumbled and Miller stepped down from managing the fund in April 2012. The following year, his Legg Mason Capital Management division was folded into ClearBridge Advisors, which Legg Mason acquired through the purchase of the former asset management division of Citigroup Inc. in 2005.

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