SS&C Technologies will acquire Citi’s Alternative Investor Services business, which includes its hedge fund administration and private equity fund services for $425 million.
The acquisition will make SS&C the second largest fund administrator, taking on Citi’s $300 billion of assets under administration (according to Evestment).
However the acquisition is not as large as its £572 million ($897 million) takeover of GlobeOp Financial Services in March 2012.
“This acquisition is solidly in line with SS&C’s strategy of combining organic growth with select, high quality acquisitions. Citi Alternative Investor Services clients can be assured of SS&C’s commitment to continue to serve them with world class people, process and technology,” says Bill Stone, Chairman and Chief Executive Officer, SS&C Technologies.
The transaction is subject to regulatory approval, and is expected to close in the first quarter of 2016.
Citi announced it was selling its hedge fund administration and transfer agency business at the end of last year, as new capital requirements under Basel III are forcing investment banks to review which units are worth keeping.
For more on the changing hedge fund administration environment, read Global Custodian’s feature in our Hedge Funds 2015 Issue.