Vestar Capital Partners will acquire Institutional Shareholder Services from MSCI for $364 million, according to a joint statement from the private equity firm and MSCI.
ISS management will join with Vestar in buying the company.
Gary Retelny, ISS president, said in an interview the percentage of the company ISS management will own is still part of the transaction discussions.
No other groups are participating in the deal.
The transaction is all cash, said Carol Makovich, spokeswoman for Vestar. The deal is expected to close by the end of June.
ISS will operate independently under its existing name once the Vestar transaction is completed, Mr. Retelny said.
“ISS' entire team is all staying in their jobs,” Mr. Retelny said. “We do not expect any change to personnel due specifically to the transaction occurring.”
The deal is meant to be seamless to reassure ISS clients of continuity of service, Mr. Retelny said.
ISS, which provides proxy-voting and corporate governance advisory services, has 1,700 firm clients, including pension funds and other institutional investors, the joint statement said. The transaction also includes ISS' Securities Class Action Services unit, which provides a database of securities litigation and settlements as well as related research.
ISS plans to pursue growth in corporate governance products, particularly in international markets, Mr. Retelny said.
In 2013, ISS accounted for 11.8% of MSCI's $1.035 billion in revenue and 4% of its $371 million in operating income, according to its 10-K report.
“This transaction underscores our belief in the importance of corporate governance and ISS' leadership position within the industry,” said Robert L. Rosner, Vestar founding partner and co-president, in the statement.
Vestar executives declined to comment beyond the statement, Ms. Makovich said.
Executives of MSCI — whose focus includes investment indexes, portfolio risk management tools and performance analytics — couldn't be reached for comment.
Morgan Stanley served as MSCI's financial adviser in the deal.