In another major M&A deal and continued interest from private equity firms purchasing recordkeeping firms, Ascensus is the latest firm to enter into an acquisition agreement.
According to an April 26 announcement, private equity firm Stone Point Capital, along with GIC, Singapore’s sovereign wealth fund, have entered into a definitive agreement to acquire Ascensus from its current private equity ownership group led by Genstar Capital, Aquiline Capital Partners and Atlas Merchant Capital. Genstar and Aquiline will retain a minority stake in Ascensus. Aquiline also holds a stake in SageView Advisory Group.
The transaction is expected to close in the third quarter of 2021, following regulatory approvals and other customary closing conditions. While the terms of the transaction were not disclosed, an earlier report by Bloomberg suggested that the deal is worth about $3 billion. In addition, Ascensus reportedly had been considering an IPO, but agreed to a sale after receiving strong interest from potential buyers.
“We are delighted to partner with Stone Point Capital and GIC, who share our confidence in the strategic importance and growth potential of the retirement, education, and health savings markets,” David Musto, President and CEO of Ascensus, said in a statement confirming the deal. “Their commitment will only strengthen our ability to continue investing in new capabilities, technology, and solutions; enhance our already world-class client service levels; and attract top talent to our organization.”
Through its operations as an independent recordkeeping service provider and TPA and its network of institutional, financial advisor, and state partners, Ascensus supports more than 12 million savers through a variety of tax-advantaged retirement, education and health savings accounts.
“We believe Ascensus is a true leader in providing technology, expertise, and partnership to enable savings across the critical areas of retirement, education, and health care,” stated Chuck Davis, CEO of Stone Point Capital. “We look forward to partnering with their management team and talented associates to support their continued growth, solutions innovation, and strong service delivery.”
In March, Ascensus closed its acquisition of the heritage BB&T 401(k) recordkeeping business as part of a deal with Truist Financial Corporation. The Truist business acquired by Ascensus covers more than 1,200 plans with approximately 140,000 participants and $6 billion in assets, increasing the firm’s retirement plan count to more than 115,000, its participant base to more than 3.3 million, and assets under administration to approximately $209 billion.
Ascensus was once a part of Bisys Group Inc., which was purchased by Citigroup in 2007 for $1.44 billion. Citigroup then sold the retirement and insurance services unit to affiliates of J.C. Flowers for $800 million. In 2015, J.C. Flowers sold Ascensus to Genstar and Aquiline.
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