Citigroup, State Street to sell CitiStreet for $900 million
NEW YORK—Citigroup Inc., which has been shedding assets as it tries to turn around following heavy quarterly losses, said Friday that it was selling one of its joint venture operations.
Citi, which is headquartered in New York, said it was selling benefit servicing company CitiStreet LLC, which it owns jointly with State Street Corp., to ING Group.
It said the all-cash transaction was worth $900 million.
ING, which is headquartered in Amsterdam and has extensive operations in the Americas, said it will fund the acquisition from existing internal resources. The deal is expected to close by the end of the third quarter.
ING said the deal will make it the third-largest defined contribution manager in the United States, with some $351 billion based on assets under management and assets under administration. ING said they covered some 14 million plan participants.
Michel Tilmant, ING Group's chief executive and chairman of the board, said in a statement that the acquisition was a "suitable add-on" business to its banking, investment and life insurance and retirement services operations.
Citistreet, which is based Quincy, Mass., was created in 2000.
CitiStreet, which has about 3,700 workers, had more than $262 billion in assets under administration as of March 31.
Citigroup said the transaction is part of its plan to sell non-core assets and reallocate capital.
State Street, meanwhile, said the sale would allow it to "pursue opportunities that will continue to build on its global franchise focused on serving institutional investors." State Street is headquartered in Boston.
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