Value in Doubt as Marsh Seeks Putnam Bids

It remains to be seen whether Marsh & McLennan can find an acceptable bid for its Putnam Investments unit, according to an analyst, in view of the steady outflow of assets under management at Putnam the past nine years.

Michael Cherkasky, Marsh's chief executive officer, said this week that after months of repeated inquiries from parties interested in either buying or partnering with Putnam, he "decided it was in the interest of our shareholders to do a market check to determine the value others would put on Putnam."

Earlier this year, Cherkasky had said the Boston mutual fund company was not for sale. In June, the company's managed assets dipped to $180 billion, the lowest total since March 1997.

Clifford Gallant, an analyst at Keefe, Bruyette & Woods who covers Marsh, said the company is just exploring its options and has not committed itself to a course of action. It might be easier to spin off Putnam, he said.

Putnam has been hurt by regulatory investigations that began in 2003 into improper trading by some portfolio managers. From 2003 through June, clients have withdrawn $156 billion more than they invested, according to the company.

Gallant said Marsh has been restructuring its businesses in the past couple of years. Its share price surged 4.3%, to $29, at Tuesday's close after the news was announced but fell 2.97%, to $28.14 a share, in midday trading Wednesday.