Marsh & McLennan Companies denied reports it has brought in two investment banking firms to explore the sale of its subsidiary Putnam Investments, disputing a story in today's Boston Globe.
Barbara Perlmutter, senior vice president of public affairs for New York-based MMC, said the professional services firm has not hired either Goldman Sachs Group or CitiGroup Inc. to explore any sale.
"It is not true," she said. "We have not hired anyone to asses these options."
She said, however, there is an internal, strategic review underway of all the company's businesses. The review should be completed in the next few weeks, she added.
MMC is comprised primarily of three divisions: the insurance brokerage powerhouse Marsh, Mercer Consulting services, and Boston-based Putnam, its investment firm subsidiary.
The Boston Globe reported MMC had asked the two investment firms to assess the value of Putnam and explore options for selling or spinning off the firm. It also reported the banks are reviewing the consulting business Mercer.
Andrew Caffrey, the author of the Globe's story, said in response to an e-mail question that he stood by the story, adding that it was well sourced.
One analyst said that a move to divest MMC of Putnam would create synergies for MMC and Putnam, creating a "near term favorable situation for MMC shares."
Jay Gelb, a senior vice president with Lehman Brothers Equity Research, wrote that while there would be short-term gains, in the long term problems remained with its core insurance business.
Mr. Gelb said Lehman estimated that if a spinoff occurred, Putnam's shares would be valued between $7 and $9.
He put MMC's target price for the year at $28 a share. At 1 p.m. today, the stock was trading at $28.87 a share, up 17 cents.
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