Marsh sells Putnam to Great-West Lifeco for US$3.9 billion

Marsh & McLennan Companies, Inc. (MMC) has announced the sale of Putnam Investments to Great-West Lifeco Inc., a financial services holding company controlled by Canada-based Power Financial Corporation, for US$3.9 billion in cash.
Putnam Investments is a global money management firm with about 3,000 employees and more than 68 years of investment experience. It had US$192 billion under management at the end of 2006.
The boards of directors of MMC and Great-West Lifeco have approved the transaction. The deal is expected to close in the middle of this year, subject to regulatory approval, required client consents, and other customary conditions.
MMC president and CEO Michael G. Cherkasky said: “This is an important transaction for MMC and its shareholders. We will receive an attractive price for Putnam, strengthen our ability to focus on our core businesses, and significantly enhance our financial flexibility.
“Selling Putnam is another important step in enhancing long-term shareholder value and driving additional success in our risk and human capital businesses.
“The proceeds to MMC from this sale, combined with our strong cash flow, will give us the flexibility to consider a number of desirable options to further strengthen our company such as investing in our business, stock repurchases, and debt reduction.”
Goldman, Sachs & Co. and Merrill Lynch & Co. acted as MMC’s financial advisors for the transaction. Davis Polk & Wardwell acted as MMC’s legal counsel.