MINNEAPOLIS--(BUSINESS WIRE)--May 3, 2006--Ameriprise Financial,
Inc. (NYSE:AMP) today announced that it has reached a definitive
agreement to sell its defined contribution recordkeeping business to
Wachovia Corp. Terms of the transaction were not disclosed, and the
sale is expected to be marginally accretive to the Company's earnings
per share and generate a modest gain on sale. The transaction is
expected to be completed late in the second quarter of 2006, subject
to pre-acquisition clearance by the U.S. Department of Justice under
the Hart-Scott-Rodino Act.
As of March 31, 2006, Ameriprise provided recordkeeping and plan
administration services to 225 defined contribution plans with nearly
700,000 participants and administered approximately $28 billion in
defined contribution assets, including approximately $11.5 billion in
RiverSource managed assets.
"This transaction is representative of our strategy to strengthen
our focus on our core capabilities of personal financial advisory,
asset accumulation, income and protection," said Jim Cracchiolo,
chairman and chief executive officer of Ameriprise Financial. "With
this sale, we enhance our margins, return on equity and shareholder
value, while exiting the scale-driven, recordkeeping portion of this
business and assuring that our client needs are addressed."
While the Company is exiting the recordkeeping business, it will
continue to provide investment management products and services,
workplace financial education and IRA rollover services to defined
contribution plans and participants. RiverSource Funds will become
available through Wachovia's defined contribution platform, which will
have more than $69 billion in defined contribution assets after the
transaction closes. Ameriprise's Financial Education and Planning
Services will continue to provide workplace financial education to its
more than 600 corporate clients, some of which are recordkeeping
clients. In addition, plan participants who are part of this
transaction will continue to have access to Ameriprise's comprehensive
IRA rollover capabilities.
Ted Truscott, president and chief investment officer of
RiverSource Investments, LLC said, "We will further devote RiverSource
Investments' resources toward delivering consistent, competitive
investment performance, developing innovative product solutions and
extending our distribution reach. We are focused on competing in four
primary channels - retail, institutional, defined contribution
investment management only and subadvisory."
Ward Armstrong, senior vice president and chairman of Ameriprise
Trust Company, added, "Wachovia was the ideal choice for this
transaction in large part for the client benefits it provides.
Wachovia is committed to providing the greatest continuity of service
to these plans; they operate on the same core recordkeeping platform,
have operations in Bloomington, Minn., which is in close proximity to
our operations, and share our strong commitment to client service. We
will work closely with them to help ensure that plan sponsors and plan
participants receive the high quality service they have come to expect
from our recordkeeping operations."
Ameriprise Financial, Inc. is a leading financial planning and
services company with more than 12,000 financial advisors and
registered representatives that provides solutions for clients' asset
accumulation, income management and insurance protection needs. The
Company's financial advisors deliver tailored solutions to clients
through a comprehensive and personalized financial planning approach
built on a long-term relationship with a knowledgeable advisor. The
Company specializes in meeting the retirement-related financial needs
of the mass affluent. Financial advisory services and investments are
available through Ameriprise Financial Services, Inc. Member NASD and
SIPC. For more information, visit www.ameriprise.com.
Ameriprise Trust Company, a Minnesota-chartered, limited service
trust company, is a wholly-owned subsidiary of Ameriprise Financial,
Inc.Ameriprise Trust Company primarily provides trustee, custodial,
administrative and employee benefit consulting services to
tax-qualified pension and profit sharing plans. Ameriprise Trust
Company provides investment management services to its fiduciary
clients and maintains collective funds, some of which are sub-advised
by Ameriprise affiliates. Ameriprise Trust Company also serves as
custodian for the Ameriprise IRAs, the RiverSource Funds and other
accounts managed by Ameriprise affiliates.
RiverSource Investments, LLC develops and manages asset growth,
preservation and income solutions that revolve around the needs of
today's investors. The firm's specialized investment platform provides
access to investment and research professionals located in strategic
investment centers in the U.S. and overseas. As a leading source of
investment insight and innovation, RiverSource Investments delivers a
full range of solutions across the risk return spectrum, to retail
investors and their advisors and to institutional investors including
corporations, pension funds, governments, foundations and endowments.
For more information, visit www.riversource.com/investments.
RiverSource Investments, LLC is an SEC-registered investment
adviser that offers investment products and services under the names
RiverSource Institutional Advisors, RiverSource Alternative
Investments, RiverSource Capital Management and RiverSource Insurance
Assets.
Investments are not insured by the FDIC, are not deposits or
obligations of or guaranteed by a financial institution, and involve
investment risks, including possible loss of principal and may
fluctuate in value.
RiverSource Funds are managed by RiverSource Investments, LLC and
distributed by Ameriprise Financial Services, Inc., Member NASD &
SIPC. Both companies are part of Ameriprise Financial, Inc.
CONTACT: Ameriprise FinancialPaul Johnson, 612-671-0625
paul.w.johnson@ampf.com
or
Todd Wold, 612-671-5683
todd.wold@ampf.com
SOURCE: Ameriprise Financial