GLOBAL/NETHERLANDS - Citigroup and State Street Corporation today announced they have entered into a definitive agreement with ING Group over the sale of the US pension provider CitiStreet.
Dutch financials group ING will buy CitiStreet, a joint venture formed in 2000 offering benefits services and retirement plans to the US defined contribution market, in an all-cash transaction valued at $900m (€578m).
"The combined operations will make ING the third-largest defined contributions business in the US based on assets under management and asset under administration," said ING this morning.
CitiStreet has around $351bn in assets under management and assets under administration as of March 31, 2008 and has approximately 3,700 employees.
The acquisition of the Quincy, Massachusetts-based firm is expected to close, pending customary closing conditions, by the end of the third quarter of this year.
ING said the deal will be financed entirely from existing internal resources.
Citigroup said in a statement today the deal is consistent with Citi chief executive Vikram Pandit's focus on divesting non-core assets and strategically reallocating capital throughout the organization.
State Street said it wants to more effectively pursue opportunities to build on its global franchise focused on serving institutional investors.
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