ING Group said this morning it has reached an agreement to acquire the retirement plan and administration company CitiStreet LLC from Citigroup and State Street in the United States for €578 million.
ING said the deal will provide significant operational synergies and is expected to be earnings per share accretive by 2010, excluding merger-related expenses and the amortisation of customer-based intangible assets.
This transaction is subject to customary closing conditions and is expected be closed in the third quarter of 2008.
"CitiStreet's impressive scale and exceptional reputation in the mid and large-corporate markets, complements ING's focus on the small and mid-corporate, government and education markets," ING board member Tom McInerney said.
ING said the acquisition will be financed entirely from existing internal resources and the proposed purchase will have no impact on ING's ongoing share buyback program.
ING added that the deal will make it the third-largest defined contribution business in the US based on assets under management (AUM) and assets under administration (AUA), with €224 billion ($351 billion) in AUM and AUA.