The firm announced today that it has signed a definitive agreement to acquire UBS Fiduciary Trust Company, a New Jersey-based provider of trust and investment management services for retirement plans.
UBS Fiduciary Trust Company (UBSFTC), which is being acquired from global financial services company UBS AG, will become part of the Retirement and Institutional Services group within Wilmington Trust’s Corporate Client Services (CCS) business, according to the announcement.
The agreement represents the second acquisition this year in Wilmington Trust’s retirement services business. On April 30, 2008, Wilmington Trust completed the acquisition of AST Capital Trust Company (AST), an Arizona-based provider of directed trustee and trust administration services offered through financial advisors (see Wilmington Trust Expands with Acquisition of AST Capital Trust).
“This new addition of retirement plan assets enhances our position in an expanding marketplace and underscores our commitment to grow our core businesses,’ said Ted T. Cecala, Wilmington Trust chairman and CEO. “It also creates opportunities for future growth and further strengthens our diverse sources of revenue.’
Wilmington Trust’s Retirement and Institutional Services group provides directed trustee, custodial, trading, and paying agent services to more than 3,000 retirement and employee benefit plans with more than $41 billion in assets under administration. The planned acquisition of UBSFTC will add another 800 plans and $5.5 billion in assets under administration to Wilmington Trust’s retirement services platform, bringing its totals to more than 3,800 plans and $46 billion in assets, respectively.
Through an existing business alliance, AST already serves as an outsource provider of fund accounting and benefit payment services to UBSFTC’s retirement plan clients. The trust and investment management services of the newly acquired company will continue to be available through 8,200 UBS financial advisors.
Kevin Ruth, chairman of UBS Fiduciary Trust Company and head of Wealth Planning U.S. for UBS, said, “The sale of UBS Fiduciary Trust Company demonstrates our commitment to delivering the best client experience for the company’s plan sponsors and participants. Our clients benefit because it combines their existing UBS financial advisor with the scalable service model of AST/Wilmington Trust and is consistent with our overall qualified retirement plan open-architecture approach.’
Pending regulatory approval, Wilmington Trust expects to complete this transaction by late summer. Since AST already is performing services for UBSFTC, Wilmington Trust expects the transaction will have little effect on AST’s or Wilmington Trust’s staffing. Full terms of this all-cash transaction, which will be non-dilutive to earnings in 2008, were not disclosed.
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