Liberty Financial Companies of Boston has announced that it has retained the investment-banking firm of CS First Boston to help review its strategic alternatives, including a "possible sale" of the company. The company also reported preliminary financial results for the third quarter ended Sept. 30.

Liberty could be purchased by a European bank, said Avi Nachmany, director of research at Strategic Insight of New York.

"One of the imbedded values in Liberty Financial in my mind is the quality and the experience of its senior people," said Nachmany. "When you have a European acquirer, it's very important to have a [collection] of skills. It would be very valuable to a potential client."

Nachmany dismissed the idea that Liberty Financial suffered because investors have been favoring giant money-management firms.

"The argument as to whether a fund is large or mid-size is totally superfluous," he said. "There are large firms that shrink, there are small firms that explode'. The small firm that exploded becomes mid-sized and the large firm becomes mid-size. Size itself is a superficial benchmark to use, he said.

Geoffrey Bobroff, president of Bobroff Consultants of East Greenwich, R.I., however, said that Liberty may be considering a sale precisely because it is a mid-sized firm.

"Mid-size money management companies are clearly struggling and most of them have been struggling for several years," said Bobroff.

Liberty Financial, in fact, may not be up for sale at all, said Bobroff. Instead, it may be trying to determine what it might command on the market so that Liberty Mutual, if it chooses to demutualize, will know how to value Liberty Financial, said Bobroff.

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