Mellon Financial Corporation has bought out Russell Investment Group’s share of the firm’s 50-50 joint venture and renamed the US-based performance measurement and risk analysis business Mellon Analytical Solutions (MAS).
As part of the acquisition of what used to be called Russell Mellon Global Analytical Services, Russell will retain ownership of Russell Indexes and bring its management in-house.
Mellon chairman and chief executive officer Martin McGuinn said the acquisition was part of the company’s strategy of investing to capitalise on growth opportunities in the asset management and asset servicing businesses.
“We are targeting these investments, such as assuming full ownership of this business, as a way to expand and further develop our existing product set,” he said.
McGuinn said MAS would be critical to the company’s custody and tax-exempt/pension fund markets and a key driver to its continued expansion of solutions for financial institutions.
He said MAS would continue to provide performance measurement and analytics services to its global institutional investment client base of 3,300, including Russell Investment Group.
Russell will continue to own the Russell Indexes and will bring all aspects of their management, which was previously outsourced to Russell/Mellon, in-house.
Russell Indexes managing director David Grieger said bringing the service and operations aspects of the Index business back in-house would give clients a cohesive team of professionals to service its needs while providing greater opportunities for research insight and development.
The Russell/Mellon joint venture was established in January 1999 and now has more than 650 employees in five countries and more than $6 trillion in assets under measurement globally.
In Australia, Russell/Mellon has seven staff based in Sydney, services 27 Australian institutional clients and has A$40 billion under measurement locally.
Under the terms of the agreement, Mellon will assume responsibility for existing Russell/Mellon locations and workforce. About 30 members of the Russell/Mellon index-related team will become Russell employees.
