Goldman Sachs to Acquire Retirement Platform NextCapital

Goldman Sachs is set to acquire NextCapital, a Chicago retirement FinTech, the two companies said in a news release Tuesday (March 29).

The deal, set to close in the second half of the year “will accelerate the expansion of Goldman Sachs’ services to the growing defined contribution market through personalized managed accounts and digital advice,” the news release said.

While terms of the deal were not released, the Financial Times says it is among the top five asset-management transactions Goldman has done.

NextCapital works with financial institutions to provide retirement planning and managed accounts through workplace retirement programs and individual retirement accounts (IRAs).

The company says its platform lets its clients – who include asset managers, plan sponsors, advisers and recordkeepers – to meet individual investor demand for more digitalization, retirement income solutions, insights and customized strategies.

“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. “We believe personalization represents the future of retirement savings and will drive the next wave of innovative retirement solutions.”

Sarsfield added that with the help of NextCapital, Goldman will continue to invest in technology that helps retirement investors and “support the growing $10 trillion DC market and the even larger IRA segment.”

See also: Goldman Sachs to Buy FinTech Lender GreenSky in $2.24B All-Stock Deal

Upon the conclusion of the acquisition, NextCapital’s platform is expected to become part of the Multi-Asset Solutions (MAS) business of Goldman Sachs Asset Management, while its team will continue to operate out of the company headquarters in Chicago.

Last year, Goldman Sachs announced plans to purchase FinTech lending company GreenSky in an all-stock deal worth $2.24 billion. Founded in 2006, GreenSky funds home improvement borrowing options for about 4 million customers and has financed upwards of $30 billion of business improvements for the healthcare, retail and eCommerce industries.