(March 20, 2014) — Great-West Life and Putnam Investments have decided to combine their retirement businesses for US markets under Great-West Financial, pulling together life insurance and asset management.
The new platform will have $220 billion under total assets under administration and serve an excess of 5 million participants.
Robert Reynolds, who was appointed president and CEO of Great-West Lifeco US, will lead the new integrated platform. He will also assume the position of president and CEO of Denver-based Great-West Financial after the retirement of Mitchell Graye in May.
Reynolds currently serves as president and CEO of Boston-based Putnam and will remain in the position.
“The US market represents a significant growth opportunity for Great-West Lifeco,” said the firm’s President and CEO Paul Mahon. “The new structure will allow Great-West Lifeco to pursue expanded US opportunities by leveraging the combined strengths and capabilities of our core businesses in a coordinated manner to best serve clients.”
According to the holding company, the merged entity will be able to provide a broad coverage of the 401(k) market as Great-West works primarily with small to medium markets while Putnam manages medium to large markets.
“Together, we can grow faster than we have been growing separately,” Reynolds wrote in an internal email. “We will work together to offer an industry-leading client experience, superior service, product innovation, and cost-effective recordkeeping to the entire US retirement market—from small to large corporate, governmental, and non-profit retirement plans.”
He revealed Charlie Nelson, president of Great-West’s retirement services, will head up the integration process. Ed Murphy, head of defined contribution at Putnam, will continue reporting to Reynolds on daily business.
“Charlie and Ed will both hold prominent roles in our new retirement business and will work with me as we develop our future strategy,” Reynolds said.
Great-West Lifeco President Mahon emphasized that except for their retirement businesses, the two companies will remain separate.
Jeff Orr, chairman of Great-West Lifeco, said in a conference call that the decision was based on “putting together the best talent and capabilities of the two companies,” not about cutting expenses or bulking up.
“By drawing upon the vision, leadership, and dedication to excellence of two superb retirement businesses, with their unmatched client service, product, marketing and technology capabilities, we will be in a position to provide the US marketplace with a superior, leading-edge offering across every client segment,” Reynolds said.
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