Retirement services provider Empower Retirement has agreed to buy wealth manager Personal Capital in a transaction worth up to $1bn.
The takeover combines Empower’s retirement plan services and integrated financial tools with Personal Capital’s digitally oriented personal wealth management platform.
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The integration is said to offer retirement plan participants and individual investors a complete picture of their finances including personal assets and liabilities.
Empower will pay $825m upon deal completion that is anticipated in the second half of this year.
It will also pay up to $175m for planned growth.
Upon closing, Personal Capital will adopt the brand “Personal Capital, an Empower Company”. The deal is pending regulatory nod.
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By GlobalDataEmpower is a much bigger player compared to Personal Capital.
Formed in 2014, Empower administers $656bn in assets for over 9.7 million retirement plan participants.
On the other hand, Personal Capital, established in 2009, oversees more than $12bn in assets.
Empower president and CEO Edmund Murphy III said: “The acquisition of Personal Capital and the integration of their tools and capabilities into the Empower offering is designed to create a best-of-breed platform — powered by digital and human advice — to help individuals achieve their financial goals.
“In addition, the retirement plan sponsors and advisers we serve will be able to offer their plan participants a more powerful retirement benefit that is highly valuable in a competitive labour market.”
Personal Capital CEO Jay Shah will assume the role of president of Personal Capital and report to Murphy III. He will also be a part of the executive team.
Shah calls Empower a “philosophically aligned partner”.
