DAVOS (Reuters) — Marsh & McLennan Cos Inc, is considering all options for its Putnam Investments asset management unit, including scrapping a potential sale plan, chief executive Michael Cherkasky said in Davos yesterday, sending its shares down 1.7 percent.The sale of Putnam, first indicated last year, could reap up to $3.9 billion for Marsh, according to newspaper reports, and Canadian fund manager Power Financial Corp has said it is in talks with Marsh to buy Putnam.

But analysts and industry officials have since said that rising redemptions and poor performances by its top funds could mean a lower price than anticipated.

Speaking on the sidelines of the World Economic Forum, Cherkasky said the group was considering all options for the unit including retaining a stake and even taking it off the block altogether.

“It is always complicated. It is a terrific company ... At the same time, if someone had the structure of a deal and the certainty for our shareholders, we would be interested. It is about weighing a number of factors,” Cherkasky said in an interview.

He declined to comment on the value Marsh, the world’s largest insurance broker, would consider adequate for the business. “The market will tell you what the value (of the asset) is. The question is whether (we find that) acceptable,” he said.

He confirmed a decision on Putnam was expected to be reached by the end of January, adding that he expected no further divestments after the issue was resolved.

Marsh shares were down 1.5 percent at $29.56 in midday trade on the New York Stock Exchange in a weak overall market.

“He’s reinforced the fact that there is still some uncertainty that a deal will be finalised. And they are still negotiating,” said Bill Bergman, equity analyst at Morningstar, adding that a deal would be positive for Marsh.

Some industry observers had expressed doubts whether a deal would go through at all, given that Putnam’s top funds are under-performing peers and investors are leaving them in droves.

Boston-based Financial Research Corp (FRC) said that Putnam again saw the heaviest redemptions in long term stock and bond mutual funds, losing $1 billion in November. It lost $13.8 billion in assets in 2006 till end-November, FRC said.

Morningstar’s Putnam analyst Reginald Laing said it would not make a difference who owned Putnam and the main thing for the firm, which has $191 billion in total assets, is retaining key investments people.

“The difference has to come from within Putnam, whoever the corporate owner is,” he added.