Goldman Sachs Group Inc. agreed to buy Dwight Asset Management, a Vermont-based stable-value money manager, from Old Mutual Plc as it expands retirement offerings for investors. Terms were not disclosed.
Dwight, which manages and advises about $42 billion in assets, is scheduled to become part of Goldman Sachs Asset Management in the second quarter, the New York-based bank said in the statement.
The purchase “enables us to deliver more investment solutions to help defined-contribution plan participants preserve and grow their hard-earned retirement savings,” said Eric S. Lane and Timothy J. O’Neill, co-heads of Goldman Sachs’ investment management unit, in a statement today.
By expanding defined-contribution products, Goldman Sachs’ investment unit is seeking a bigger share in the U.S. retirement market, where assets have surged 47 percent to $17 trillion since 2000, according to data from the Investment Company Institute in Washington. Employer-based defined-contribution plans, which allow individuals to invest money toward retirement, accounted for about $4.3 trillion of the total.
Stable value funds seek to preserve capital by investing in bonds and are offered in about half of all defined-contribution plans, according to the Stable Value Investment Association. There are about $540 billion in assets in such funds, according to the Washington-based organization.
The sale of Dwight will help “free up capital to redeploy into our global distribution and asset management franchise,” Peter Bain, the chief executive officer of Old Mutual Asset Management, said in today’s statement.