Ameriprise Financial Inc. of Minneapolis has agreed to sell its defined contribution recordkeeping business to Wachovia Corp., the companies announced today.
The deal is expected to be completed late in the second quarter, pending U.S. Justice Department approval, according to Ameriprise. The terms of the agreement were not disclosed.
As of March 31, Ameriprise provided recordkeeping and plan administration services to 225 defined contribution plans with nearly 700,000 participants and administered about $28 billion in defined contribution assets, including about $11.5 billion in RiverSource managed assets.
Ameriprise Financial, a financial planning services company with more than 12,000 advisors, owns Ameriprise Trust Company, which is custodian for Ameriprise IRAs, RiverSource Funds and other accounts managed by Ameriprise affiliates.
Ameriprise's defined contribution unit will become part of Wachovia Retirement Services, which will grow to more than 2 million participants and pensioners and more than $100 billion in assets after the deal.
"This transaction is representative of our strategy to strengthen our focus on our core capabilities of personal financial advisory, asset accumulation, income and protection," said Jim Cracchiolo, chairman and CEO of Ameriprise Financial. "With this sale, we enhance our margins, return on equity and shareholder value, while exiting the scale-driven, recordkeeping portion of this business and assuring that our client needs are addressed."