A late-afternoon news release said that the deal includes the Atlanta-based AMVESCAP Retirement, Inc. as well as its registered broker dealer subsidiary. Financial terms were not disclosed, according to the announcement.
“This acquisition is in keeping with our growth strategy to partner with select organizations to provide best in class services to businesses and their employees,” said Michael Falcon, chief operating officer for the Retirement Group at Merrill Lynch, in the news release. “With this transaction, Merrill Lynch is acquiring a robust platform for providing retirement services to other institutions, expanding its already large client base, and enriching its talent pool with an experienced employee team.”
The news release said that the AMVESCAP companies will become part of a subsidiary of Merrill Lynch , The Princeton Retirement Group, Inc., which will serve retirement plan sponsors – including corporations, government entities and not-for-profit organizations, as well as other financial institutions and intermediaries from a base in Atlanta. Merrill spokesman Erik Hendrickson said Patrick Cassidy will run the recordkeeping operations, reporting to Cynthia Hayes, first vice president, Employer Plan Management for the Merrill Lynch Retirement Group. Cassidy is adding the retirement unit to his current slate of responsibilities, which already includes managing the retirement group’s relationships with the 100 fund families with which it does business.
Cassidy said it is not necessary for Merrill to have a systems conversion period where AMVESCAP clients are migrated from their current RK platform to the OmniPlus platform Merrill currently uses. Those clients can continue using their current platform, he said. The AMVESCAP deal is part of Merrill’s long-term strategy to continue to build a back-office capability. “We believe that the platform provides us the opportunity offer private label investment and advisory services to third-party partners,” Cassidy said.
Hendrickson said the “large majority” of AMVESCAP’s approximately 500 employees are expected to stay on, but that specific staffing decisions have not yet been made. In terms of facilities consolidation, he said the only place where the two companies overlapped was in Denver. There, he said, the three AMVESCAP Retirement employees will be transferred to Merrill’s Denver operation.
The announcement said that under the Princeton Retirement Group, services to other institutions will carry neutral branding to complement the distribution, product and client service requirements of each client, Cassidy said. With the capabilities of OmniPlus, clients can opt for the Princeton branding or can use their private label, he asserted.
The Retirement Group at Merrill Lynch served approximately 5.7 million individuals and more than 29,000 business retirement plans, as of December 31, 2004. It had almost $329 billion in client assets as of that same date. The Retirement Group is organized under three business units: Individual Retirement Services, Employer Plan Services and Equity Award Program Services.
AMVESCAP Retirement, Inc, which also has offices in Winston-Salem, North Carolina; Lincoln, Rhode Island; and Denver, Colorado is a subsidiary of AMVESCAP PLC. Under chairman Hubert (Herky) Harris, Jr., and president and CEO Robert O’Connor, the unit had $28 billion in assets under administration as of December 31, 2004, according to the AMVESCAP Web site. With more than 6,000 employees, AMVESCAP PLC had $382.1 billion in assets under management as of December 31, 2004.
More information about AMVESCAP Retirement is at http://www.amvescapretirement.com/index2.asp .