London Stock Exchange Group plans to make a comprehensive review of Russell Investments’ investment management division after it acquires the Seattle-based firm.
LSEG announced the acquisition early Thursday, saying it will acquire the entire Russell Investments business from Northwestern Mutual and other minority shareholders. The $2.7 billion deal is expected to close by early next year at the latest.
LSEG said in a presentation accompanying a conference call that it would take a thorough look at the $256 billion investment management and consulting divisions to see how they fit in with the overall LSEG organization. That review is expected at or following the completion of the acquisition.
Management consultant Casey, Quirk & Associates will be hired to assist with the review process, an LSEG spokeswoman said. “During the review process, management is particularly focused on maintaining the highest levels of investment management client service and continuing the strong, stable growth of the business,” she wrote in an e-mailed comment.
As part of the deal, LSEG also will acquire Russell’s index business, which has about $5.2 trillion of assets benchmarked against it. LSEG’s own index business, FTSE, has $4 trillion of equities benchmarked against it.
In a conference call for media, Xavier Rolet, CEO of LSEG said: “We do not believe in diversification for diversification’s sake. (We are) expanding and in a global fashion. … Russell is complementing the strengths of FTSE in product expertise and geographically.”
Len Brennan, president and CEO of Russell Investments, will join LSEG’s executive committee upon completion of the deal.
“This is a very high-quality business with a track record of innovation and a world-class client and employee base, and we are committed to preserving the qualities that have attracted these clients and employees to the firm,” Mr. Rolet said in a statement on the firm’s website.
A presentation by LSEG relating to the acquisition said retention plans will be put in place for key Russell employees.