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UPDATE 1-London Stock Exchange in talks to buy Russell Investments

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LONDON, May 13 (Reuters) - The London Stock Exchange Group is in talks with the parent company of Russell Investments about a possible acquisition of the asset management and stock index firm.

Life insurance company Northwestern Mutual started exploring a sale of Russell, which has $259.7 billion in assets under management, in January after deciding it was not a core part of its business.

Sources told Reuters last month that Canadian Imperial Bank of Commerce, the fifth-largest bank in Canada, was considering a bid for Seattle-based Russell, which provides services including pension consulting, investment management and indexes such as the Russell 1000 Global Index.

Private equity firms CVC Capital Partners and Silver Lake have also teamed up to pursue a bid, as have Warburg Pincus and TPG Capital, the sources said.

The London Stock Exchange (LSE) said on Tuesday it was evaluating the merits of a deal and was engaged in talks with Northwestern Mutual, but there was no certainty that any transaction would be forthcoming.

It said it would part-fund any deal through an equity raising.

The LSE already has a index business after it took over FTSE International in 2011 as part of a push into listed derivatives.

(Reporting by Clare Hutchison; Editing by Jason Neely and Mark Potter)

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