Deal will add around $100 billion in assets with most employees expected to stay on at new firm
One of the biggest names in the asset management arena has been bought out by another major company.
State Street Corporation has reached an agreement to pay around $485 million for General Electric Co.’s asset management unit. The deal will expand its alternative investments including real estate and private equity.
According to a report by Bloomberg, the purchase will add around $100 billion in assets focusing on institutional clients such as endowments, insurers, foundations, retirement plan sponsors and sovereign wealth funds.
Thanks to the deal, State Street will take over the assets of the GE pension plan with most of the existing team expected to join the firm – although a small number will stay on with GE to monitor its primary benefit plans.
The move follows on from the appointment of Ron O’Hanley as the head of State Street asset management. The former Fidelity Investments executive became the head of the $2.25 trillion money management area of State Street last year with the company having lost some ground in recent years to the likes of Vanguard and BlackRock.
Meanwhile, GE Asset Management is being sold as its focus narrows on industrial operations that make products including jet engines and oilfield equipment.
The transaction is expected to close in the third quarter with State Street expecting integration costs in the region of $70 million to $80 million.
State Street Corporation has reached an agreement to pay around $485 million for General Electric Co.’s asset management unit. The deal will expand its alternative investments including real estate and private equity.
According to a report by Bloomberg, the purchase will add around $100 billion in assets focusing on institutional clients such as endowments, insurers, foundations, retirement plan sponsors and sovereign wealth funds.
Thanks to the deal, State Street will take over the assets of the GE pension plan with most of the existing team expected to join the firm – although a small number will stay on with GE to monitor its primary benefit plans.
The move follows on from the appointment of Ron O’Hanley as the head of State Street asset management. The former Fidelity Investments executive became the head of the $2.25 trillion money management area of State Street last year with the company having lost some ground in recent years to the likes of Vanguard and BlackRock.
Meanwhile, GE Asset Management is being sold as its focus narrows on industrial operations that make products including jet engines and oilfield equipment.
The transaction is expected to close in the third quarter with State Street expecting integration costs in the region of $70 million to $80 million.
