Wilmington Trust, a wealth management firm and a wholly-owned subsidiary of M&T Bank, has reached a deal to sell its Collective Investment Trust (CIT) business to Chicago-based private equity company Madison Dearborn Partners (MDP).

Part of Wilmington Trust’s Institutional Client Services (ICS) unit, CIT provides asset managers and stakeholders in the employer-focused retirement market with third-party trustee and administrative solutions.

CIT currently oversees around $115bn in CIT assets on behalf of over 550 funds for nearly 45 subadvisors, such as AllianceBernstein, BlackRock, Franklin Templeton, among others.

Once the new deal is closed, CIT will operate independently under a new brand name owned by MDP-affiliated funds.

Wilmington Trust Rob Barnett executive vice president will become the CEO of the new company.

The deal, which awaits customary closing conditions and regulatory approvals, is anticipated to be completed by mid-next year.

8CIT will leverage MDP’s experience in the financial services industry to boost its trustee and administrative services customer relationships activities, following the completion of the deal.

It will also be able to receive additional investment in product offerings, technology solutions and strategic acquisition plans.

Barnett said: “The CIT business is an industry leader, well-respected, and recognized for its successful track record of innovation.

“This transaction will help ensure continued growth for our business, people, and clients well into the future.

“MDP has extensive experience in financial services and will add significant value to our newly formed company.”

In April this year, M&T Bank announced the conclusion of a deal to buy People’s United Financial to expand its financial services capability.