The CitiStreet name is unlikely to be retained as part of the sale to ING Group, with the global retirement business expected to be transitioned under the ING banner.
ING Group announced yesterday it had bought CitiStreet LLC, including its subsidiary CitiStreet Australia in an all-cash transaction valued at $900 million.
“ING has a strong global brand. Over time, the CitiStreet operations will transition to the ING brand,” ING spokesperson Peter Hansen said.
Commenting on the deal, CitiStreet Australia chief executive Stuart Korchinski said the acquisition was a positive for both groups.
“ING clearly has a commitment to retirement services globally and you just have to look at the fact that they went out in what was a contested process and basically said we want it [CitiStreet] and took it out,” Korchinski told InvestorDaily.
“From CitiStreet’s client perspective, that’s a great demonstration of interest and the fact that it’s a core strategy for ING it will ultimately deliver better capability than otherwise may have been the case.”
CitiStreet Australia will continue to report to CitiStreet in the United States and what will become CitiStreet United States in the ING world.
“There will obviously be ongoing considerations as we get to know one another better as to how we can deliver more value to our clients and to our staff,” he said.
The acquisition of CitiStreet LLC will make ING the third-largest defined contribution business in the US based on assets under management and assets under administration (AUA) with AUA at $373 billion.
CitiStreet has operations in the United States and Australia and provides a range of recordkeeping and administrative services to more than 16,000 plans and 12 million participants.
CitiStreet has more than $262 billion in assets under administration as of March 31, 2008 and approximately 3,700 employees.
