Reuters is reporting that the buyers for Russell Investments are down to three, including a large U.S. benefits consulting firm.
Citing “people familiar with the matter,” Reuters said that Towers Watson remains in the bidding, as well as China's Shanda Games Ltd. and CITIC Group. In what is expected to be a $1.5 billion deal, those sources said that Towers Watson, known primarily for its risk management and HR consulting services, is looking to expand into asset management.
As for Shanda Games (a Chinese online game developer), it is reportedly interested in entering the financial services business. CITIC, a Beijing-based conglomerate, has a financial services arm and also owns CITIC Asset Management Corporation Ltd.
The report notes that London Stock Exchange Group plc, which owns Russell, may be inclined to favor Towers Watson as a more reliable buyer than the other two firms. LSE bought Russell from Northwestern Mutual last year for $2.7 billion, primarily for its large index business.
Russell had $272 billion in assets under management at year-end 2014, according to its website. Earlier this month, the firm announced the expansion of its tax-managed fund lineup with the introduction of the Russell Tax-Managed International Equity Fund and the Russell Tax Exempt High Yield Bond Fund, noting that the two new funds would be incorporated into Russell Investments’ Tax-Managed Model Strategies as part of an effort to “provide financial advisors with multi-asset investment solutions that seek to deliver higher after-tax returns to their clients.”
