New York – Interesting: After several years of acquisitions of research providers, RiskMetrics has apparently put itself up for sale. The linked article does a great job of assessing the potential buyers, including Private Equity firms, such as KKR and Carlyle Group as well as traditional information services businesses like Bloomberg, Thomson Reuters, McGraw Hill and MCSI.
In its recent spate of acquisitions, RiskMetrics put together an impressive array of research assets, all positioned as risk management tools, rather than investment research. Among the firms now under the RiskMetrics umbrella are Institutional Shareholder Services (ISS), Forensic Account research providers CFRA, and other assets to complete its ring of risk management tools.
Just why the firm is up for sale right now is not known, but it certainly must relate to its relatively new status as a publically listed company (2008). There are currently three PE firms, General Atlantic, Spectrum Equity and Technology Crossover Ventures, which together own 46% of the stock of RiskMetrics and have invested about $120 million into the firm since 2004. This suggests that this is an exit strategy for these investors.