NU Online News Service, June 7, 11:13 a.m.EDT

Marsh & McLennan Companies Inc. is selling its riskconsulting subsidiary, Kroll, to Mike Cherkasky, the former chiefexecutive of both Kroll and MMC, in an all-cash deal valued at$1.13 billion.

The sale of Kroll, acquired over six years ago by MMC, has beenrumored for months.

As recently as May, Brian Duperreault, president and chiefexecutive officer for MMC, said he had no intention of breaking upMMC with regard to its insurance (March and Guy Carpenter) andconsulting segments (Mercer and Oliver Wyman).

However, he said nothing at the time to squelch rumors thatthere were plans to sell Kroll.

Meyer Shields, an analyst with Baltimore-based Stifel, Nicolaus& Company Inc., called the move a good deal for MMC, notingthat Kroll never really fit with MMC's insurance and consultingbusiness. (In the interest of disclosure, Stifel, Nicolaus hasbanking interests with MMC.)

"When you get rid of a business that is a distraction--in otherwords, when the CEO of Marsh had to keep track of what was going onin this industry, there was no real synergy--I think that's apositive," said Mr. Shields. He noted that the price makes senseand is in line with earnings expectations.

One positive from the deal for MMC is that with its plans toacquire independent agencies through its Marsh & McLennanAgencies subsidiary to become a bigger player in the small tomid-size account market, "cash will be particularly helpful," saidMr. Shields.

The deal is subject to regulatory approvals and other customaryclosing conditions, New York-based MMC and Altegrity (aninternational screening and security solutions companyheadquartered in Falls Church, Va.), said in a joint statement.

The transaction is expected to close by late September.

"Over the past six years, Kroll has been a valued member of theMMC family," said Mr. Duperreault in a statement today. "However,we have determined our long-term strategy is to focus on the Riskand Insurance Services and Consulting businesses. Altegrity, withits complementary practice areas and expertise, will be a superbpartner with Kroll to help drive the continued success of Kroll'sbusinesses and people."

"Our clients look to Altegrity for information and insight tomake smarter decisions," said Mr. Cherkasky, Altegrity's CEO. "Thecombination of Kroll and Altegrity broadens our capabilities withthe addition of a portfolio of industry-leading services to helpclients identify and manage risk. Altegrity and Kroll will leveragetheir combined resources to develop new and innovative solutionsfor government and commercial clients across a globalplatform."

Mr. Cherkasky was president and CEO of Kroll from 2001 to 2004,and served as president and CEO of MMC until 2008.

Ben Allen, CEO of Kroll, said the transaction represents newopportunities for the company, adding that the firm is "now poisedto continue its historical track record of growth."

Altegrity is owned by Providence Equity Partners, a privateequity firm specializing in equity investments in media,entertainment, communications and information companies.

Julie Richardson, a managing director at Providence and anAltegrity director, said that Providence has worked with Altegrity"to build a global leader in risk assessment and mitigation" andthis acquisition is "the capstone to that effort..."