TA Associates has agreed to sell Russell Investments to a consortium of US investors led by Reverence Capital Partners, in a deal that values the asset manager at approximately $1.15 billion. The transaction, announced on Monday, marks the exit of TA Associates after a four-year ownership period.
Deal Details
The consortium includes Reverence Capital Partners, a private equity firm focused on financial services, along with other institutional investors. The purchase price represents a multiple of about 10 times Russell Investments' expected 2024 adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA), according to a person familiar with the matter.
Russell Investments, based in Seattle, manages $306 billion in assets as of December 31, 2023. The firm provides investment management, insurance, and pension services to institutional clients and individual investors.
Background and Strategic Rationale
TA Associates acquired Russell Investments from the London Stock Exchange Group in 2020 for $1.15 billion. The sale to the Reverence-led consortium allows TA Associates to realize a return on its investment after a period of growth and strategic repositioning at Russell.
"We are pleased to have partnered with TA Associates and the management team to support Russell Investments' next phase of growth," said Milton Berlinski, co-founder and managing partner of Reverence Capital Partners, in a statement. "We believe Russell is well-positioned to continue delivering strong outcomes for its clients."
Industry Impact
The deal reflects continued private equity interest in asset management firms, as investors seek stable fee-based revenue streams. Russell Investments has been streamlining its operations, including the sale of its non-US exchange-traded fund business to BlackRock in 2022.
The transaction is expected to close in the second quarter of 2024, subject to regulatory approvals and customary closing conditions. Upon completion, Russell Investments will operate as a standalone entity under the ownership of the consortium.
