BlackRock has sold part of its UK defined contribution (DC) business to Aegon, deciding to focus on investment management over administration.

The asset manager said it reached an agreement to sell its DC platform and administration business, which has £12bn (€15.3bn) in assets under management, to Aegon, boosting Aegon’s DC platform to £30bn.

Paul Bucksey, head of DC at BlackRock, will become managing director of the new combined workplace business, while BlackRock will remain focused on its DC investment management capabilities, where it is responsible for £65bn, according to a statement by the company.

David Blumer, head of BlackRock EMEA, said the changes to the UK pensions landscape over the past five years – such as the end of mandatory annuitisation and the resulting focus on drawdown products – had led to its decision to sell part of its business.

“BlackRock believes Aegon’s broad retail product and digital capabilities will best serve the increased demand from employers for holistic retirement solutions in the future,” Blumer said.

“[It is a] perfect partner to deliver on our DC platform and administration clients’ growing needs.”

Blumer said BlackRock would continue to work with other clients in the occupational pensions space and on investment products for providers including master trusts.

Both BlackRock and Aegon declined to disclose the sales price, but the former said in a statement the financial impact of the deal was “not material”.

Alongside Bucksey’s move to head the combined business, BlackRock said its DC platform staff would be retained by Aegon, providing “stability and ongoing continuity” for the affected pension trustees.

Adrian Grace, chief executive at Aegon UK, said the company’s strength made it a “compelling” partner.

“With employers demanding additional solutions to meet employees’ needs to and through retirement, workplace savings are no longer just about traditional DC pensions,” he said.