Russell Investments gets ‘rich’ bids, second round begins: sources

The London Stock Exchange received 20 bids for its asset management unit, Russell Investments, three sources said.

First round proposals for Russell were due earlier this month, peHUB has previously reported. The LSE is narrowing the bids to roughly 10 that are more than $1.2 billion, sources said. Offers for Russell were “very rich” and some neared $1.5 billion, one of the sources said.

The second round for Russell has begun, a different banker said. The LSE is bringing in about six to eight bidders, the source said. All of those through to the second round had bids of at least $1.4 billion, the banker said.

“It’s more strategics than you think, coming out of Asia,” the person said. “I don’t see Russell selling for below $1.5 billion.”

The LSE said in February it would sell Russell Investments, the asset management unit of Frank Russell Co, after receiving expressions of interest. The LSE has tapped JPMorgan and Goldman Sachs to run the Russell auction.

The LSE conducted a “broad sales process” for Russell and sent out more than 50 books, peHUB has reported. It’s unclear who is bidding for the unit, but private equity was expected to dominate the process.

Founded in 1936, Russell had $272.6 billion in assets under management as of Dec. 31, according to its website. The firm produces $125 million EBITDA and has been expected to fetch from $1.3 billion to $1.4 billion, peHUB has reported.

Executives at JPMorgan declined to comment. Russell refers call to the LSE, which declined comment beyond the February statement. Goldman couldn’t be reached for comment.

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