(Russell.com)

Russell Investment Group Acquires Towers Perrin's HR Services Operation in Australia
Creating an investment and superannuation powerhouse

AUCKLAND, 31 August, 2004— Russell Investment Group, the global leader in multi-manager investments, and Towers Perrin (Australia) Pty Ltd, a leading advisor to Australia's largest pension funds, today announced that Russell Investment Group has acquired the Towers Perrin HR Services (actuarial services, asset consulting and employee benefits administration) operations in Australia. This agreement has no impact on the other parts of Towers Perrin's global HR Services business or its Tillinghast business in Australia.

The organisations will offer an unmatched spectrum of services, including; independent actuarial advice, asset consulting, implementation services and stand-alone administration services. If clients require a more comprehensive outsourcing solution, there is also a master trust, a tailored total outsourcing solution and a range of multi-manager funds.

Mr. Alan Schoenheimer, Managing Director of Russell Investment Group in Australasia, said, "this exciting move is the logical next step in our relationship". It follows three years of successful collaboration between the two firms, who have shared investment research resources as well as jointly completed many of Australia's largest superannuation outsourcing deals.

"This landmark transaction creates an investment and superannuation powerhouse," Mr. Schoenheimer said. "The range of services is unmatched in the Australasian marketplace and our organisations are now ideally positioned for strong growth in this competitive environment." Key elements of the deal include:

The HR Services business of Towers Perrin in Australia will now be known as Russell Employee Benefits, and will become a wholly-owned subsidiary of Russell Investment Group Pty Ltd.
The purchase of Towers Perrin's HR Services business in Australia by the Russell Investment Group will have minimal impact on individual staff roles and client servicing arrangements, with only the asset consulting practices planned for an immediate integration.
Towers Perrin's Australian asset consulting practice will integrate with Russell's asset consulting practice. The two practices, which have been sharing the same underlying manager research since October 2002, will be fully integrated to create Australasia's largest asset consulting business.

Dr. Edward Schuck, Managing Director of Russell Investment Group in New Zealand, said the acquisition makes tremendous sense strategically. "For some time, Towers Perrin and Russell have been working together in Australia offering a fully outsourced superannuation solution. The acquisition solidifies that relationship and creates an overall business that is the industry leader on all counts."

Dr. Schuck added that the acquisition is also exciting for New Zealand. "Benefits will accrue to our New Zealand customers as a result of the leap in resources devoted to asset consulting regionally. We are also looking at expansion of the product range in New Zealand utilizing the superannuation scheme administration services now available from Russell Employee Benefits. The additional growth opportunities we now face are substantial."

About Russell:The Russell Investment Group, a global investment services firm, provides multi-manager investment products and services in more than 35 countries and has been researching investment managers for more than 30 years. Worldwide, Russell manages over NZ$149 billion in assets and advises clients representing approximately NZ$3 trillion. In New Zealand, Russell advises on more than NZ$14 billion in assets and invests around NZ$1.0 billion for NZ investors in Russell Funds. Further information about Russell Investment Group NZ can be found at www.russell.com/nz

About Towers Perrin: Towers Perrin is a global professional services firm that helps organizations improve their performance through effective people, risk and financial management. The firm provides innovative solutions to client issues in three areas: Human Resource Services, which provides human resource consulting and administration services; Reinsurance, which provides reinsurance intermediary services; and Tillinghast, which provides management and actuarial consulting to the financial services industry. Together, these businesses have over 8,000 employees and 78 offices in 76 cities and 24 countries. More information about Towers Perrin is available at www.towersperrin.com