Ascensus buying Vanguard small-business retirement offerings

The company is acquiring the Individual 401(k), Multi-SEP, and SIMPLE IRA plan businesses from Vanguard.

Ascensus announced Tuesday that it’s acquiring three Vanguard Group lines of retirement plans designed for small businesses: the Individual 401(k), Multiple Participant SEP and SIMPLE IRA plan businesses.

Ascensus, a third-party administrator and retirement plan provider, says the deal will increase the number of retirement plans it administers to nearly 280,000.

While Ascensus will provide the plans with services including record keeping, client servicing, transaction processing, tax reporting and custodial and trustee services, the plans will still have access to Vanguard funds.

The announcement says that Vanguard will still offer one-person SEP IRAs for owners of small businesses who don’t have employees and that the deal doesn’t include other retirement solutions provided by Vanguard.

“This acquisition offers small business employers continued access to Vanguard’s investment strength and the technology, expertise, and operational excellence that clients have come to expect from Ascensus,” Nick Good, president of Ascensus, said in a statement.

“The breadth and nuance of small business plan administration increasingly requires deep specialization, and we believe business owners and their employees will be best served by an organization with significant expertise and scale in serving Multi-SEP, SIMPLE IRA, and Individual 401(k) savers,” Armond Mosley, principal and head of Vanguard’s self-directed business, said. “We know that clients in these plans will benefit from Ascensus’ longstanding commitment to helping these small business clients meet their retirement objectives.”

The transaction is expected to close in the third quarter. Terms were not disclosed.

This is the second big deal by Ascensus in as many months; in March, it announced that it was acquiring the record-keeping business of Mutual of Omaha, which administered more than 2,300 retirement plans.

Ascensus had more than $760 billion in assets under administration at the end of 2023.