A recurring rumor re-emerged Wednesday – this time in Australia – that Puget Sound-based international investment advisory company Russell Investments may be for sale.
Russell was founded in Tacoma in 1936 and maintained its headquarters here until 2010, when the company moved to the former Washington Mutual headquarters building in Seattle. Many employees still live in Pierce County.
The Australian Financial Review reported that Russell’s parent company, Northwestern Mutual Life Insurance Co. of Milwaukee, is considering selling off all or parts of Russell. The financial publication speculated that other asset consulting companies could acquire Russell.
The Review said Russell has a reputation for quality investment research, but may be finding strong competition from less expensive alternatives.
“Russell’s research team is well resourced – in better times the firm is said to have boasted spending a global sum of $50 million a year on manager research,” the paper said. “That also meant its multi-manager products were among the most expensive.
“Russell is said to have one of the best processes in the market, but clients have found cheaper managers deliver competitive returns, while do-it-yourself products such as Mercer’s global investment manager database can be had for as little as $100,000,” the Financial Review said.
Neither Russell nor Northwestern Mutual have commented on the report.
Rumors of the life insurance company wanting to sell Russell have come up for years, during the financial crisis and as the company left Tacoma.
Russell has seen turmoil in the last several years, with significant layoffs at the beginning of the recession. The company also shut down two of its three hedge funds as the economy crashed.
It has seen a succession of chief executives in recent years.
Len Brennan, who had worked at Russell for two decades before leaving in 2005, was named the company’s fourth CEO in four years last summer. He replaced Andrew Doman, a former Mc-Kinsey & Co. consultant who was named CEO in 2009 and led the company out of Tacoma.
Northwestern said that one of the reasons for moving the company to Seattle was the availability of Washington Mutual’s signature skyscraper at a bargain price. Northwestern paid just $115 million for the 42-story tower.
Now Northwestern has put the building on the market and has rented the penthouse floors to Boeing’s Commercial Airplanes Group for its in-city headquarters.
The structure is reportedly 96 percent leased with other tenants such as real estate website Zillow, Nordstrom and biotech company Dendreon. Some realtors have speculated Northwestern could sell the building for several times its investment.
John Gillie, staff writer