NEW YORK - Voya Financial, Inc. (NYSE: NYSE:VOYA) has announced the acquisition of OneAmerica Financial's full-service retirement plan business, significantly expanding its Wealth Solutions division. This strategic move will increase Voya's assets under administration (AUA) by approximately $47 billion, particularly strengthening its presence in the emerging and mid-market segments.
The transaction sees Voya's full-service retirement business grow to $580 billion in AUA, with the retirement plan and participant count reaching 60,000 and 7.9 million, respectively. The acquisition includes a variety of retirement plan types, such as 401(k), 403(b), 457, non-qualified deferred compensation plans, and employee stock ownership plans.
Heather Lavallee, CEO of Voya Financial, expressed enthusiasm for the acquisition, stating that it aligns with the company's growth strategy in providing workplace benefits and savings solutions to a broader clientele. She emphasized that OneAmerica's commitment to financial security complements Voya's customer-focused approach.
Scott Davison, chairman, president, and CEO of OneAmerica Financial, Inc., conveyed confidence in Voya's ability to offer industry-leading services and saw the transaction as an opportunity for OneAmerica's customers and associates to benefit from Voya's offerings. Following the acquisition, OneAmerica will concentrate on its remaining core product lines.
The deal, expected to close on January 1, 2025, is subject to regulatory approvals and other customary closing conditions. Voya plans to discuss further details of the transaction during its third-quarter 2024 earnings call.
The acquisition is set to enhance Voya's service offerings across all markets and tax codes, including the addition of OneAmerica's employee stock ownership program. This move is also anticipated to strengthen Voya's relationships with intermediaries and expand its distribution network.
This strategic acquisition is based on a press release statement and is subject to the fulfillment of closing conditions and regulatory approvals. Additional financial details and implications of the transaction have been made available on Voya's investor relations website.
Citi and Eversheds Sutherland LLP are advising Voya on the transaction, while Goldman Sachs & Co (NYSE:GS). LLC and Sidley Austin, LLP are advising OneAmerica Financial Partners.
In other recent news, Voya Financial reported an adjusted operating earnings per share (EPS) of $2.18 and a GAAP net income of $201 million for the second quarter of 2024. Despite challenges in the Health segment, the company's Wealth and Investment Management segments showed growth, contributing to a robust excess capital position of approximately $200 million. Additionally, Voya Financial surpassed $100 billion in assets across its multiple employer solutions, marking a 15% increase in total assets since last year.
Voya Financial also announced the appointment of Michael Katz as the new CFO, set to take his position on January 1, 2025. Katz, a long-standing member of the Voya team, will succeed Don Templin, who plans to retire. On the analyst front, while Piper Sandler reaffirmed its Overweight rating and $84.00 stock price target for Voya, Morgan Stanley (NYSE:MS) downgraded Voya's stock from Overweight to Equalweight due to concerns about the Health Solutions segment's performance and the integration of Benefitfocus (NASDAQ:BNFT) into Voya's operations.
Barclays (LON:BARC) initiated coverage on Voya Financial, issuing an Overweight rating based on the assessment that Voya Financial has been generating strong and consistent cash flow. These are some of the recent developments at Voya Financial, with management planning to address the challenges in the Health Solutions segment with new pricing strategies and measures.
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