Goldman Sachs Group Inc (GS)

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Goldman Sachs to Acquire Pension Robo-Advisor NextCapital
By: Barron's | March 29, 2022

Goldman Sachs is acquiring NextCapital, a Chicago-based robo-advisor, as part of its continued expansion into asset and wealth management.

NextCapital partners with financial institutions to provide planning services for workplace retirement plans and individual retirement accounts. It currently has about $220 billion in assets under supervision, according to a press release.

The acquisition will augment existing capabilities across Goldman Sachs’ (ticker: GS ) growing asset and wealth management business, and coincides with a growing push in wealth management circles toward technological advances and the adoption of robo-advisors.

“Employers are looking to provide their employees tailored solutions and customizable advice that can better support individual saving and investing needs to help improve retirement savings outcomes,” said Luke Sarsfield, co-head of Goldman Sachs Asset Management in a statement. “We believe personalization represents the future of retirement savings and will drive the next wave of innovative retirement solutions.”

The deal is expected to close in the second half of 2022, subject to regulatory and other approvals. Goldman didn’t disclose further terms of the deal.

Over the last few years, Goldman has been pushing to expand its wealth management capabilities. In 2020, the bank broke from tradition by holding its first-ever Investor Day where it announced it would revamp its Consumer & Wealth Management segment.

“This acquisition furthers our strategic objective of building compelling client solutions in asset management and accelerating our investment in technology to serve the growing defined contribution market,” said CEO David Solomon in a statement.

Shares of Goldman were up about 2% on Tuesday.

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