Echoing Fidelity Investments’ recent purchase of eMoney Advisor LLC for $250 million, Northwestern Mutual has sprung for a digital financial planning software firm of its own, also for a reported $250 million.
But while analysts easily grasped the rationale for Fidelity’s purchase of eMoney — namely its ability to generate cash flow as a stand-alone unit — they are at more of a loss to understand what exactly Northwestern is up to with its purchase of LearnVest Planning Services.
With $2.7 billion in cash to burn after the Russell Investments spin-off, the Milwaukee-based company was simply an old-line insurer with desktop software in search of a planning pedigree Brooke’s Note: When a company that trumpets itself as a Quiet Company, no, the Quiet Company, and makes a loud bang by dropping a quarter-billion on a startup’s head, you do a double take. What could possibly take an insular, old-line, sales-based, product-based, self-assured company that virtually never buys companies so far out of its comfort zone? The answer, presumably, is concern — maybe fear — that trumps the discomfort that comes from inorganic gobbling. The list of potential reasons for unease at the Milwaukee-based maker of life insurance, annuities and disability insurance is long.
unknownx500
