Aegon UK, the pension, insurance and investment company based in Edinburgh, is acquiring £12 billion of assets and 350,000 customers from BlackRock for an undisclosed sum.
The deal will see around 150 BlackRock staff based across offices in London and Peterborough transfer over to the Dutch-owned company.
The US investment management corporation said it is selling its defined contribution platform and administration business to focus on investment management in the pensions arena.
It will continue to provide that service to the customers in workplace pension schemes at various sizes of employers who are moving to Aegon. The company already provides investment management services to Aegon.
A spokesman for Aegon UK, the former Scottish Equitable, confirmed there are no plans for any redundancies as a result of the deal. Staff in London may eventually come under one roof but that is thought unlikely to happen in the near term.
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The company said it will have a wider offering of products for workplace pension schemes, with the market expected to grow rapidly as the impact of auto-enrolment begins to filter through. The agreement means Aegon will have around £30 billion of assets on its workplace platform.
Adrian Grace, the Aegon UK chief executive, said: “The combined strength and breadth of expertise makes us a compelling choice. With employers demanding additional solutions to meet employees’ needs to and through retirement, workplace savings are no longer just about traditional defined contribution pensions.
“This makes it an exciting market and with an expectation it will triple in size over the next ten years, we are well positioned to take advantage.”
Mr Grace said in February that he was targeting £80 billion of assets.
Paul Bucksey will move from head of defined contributions at BlackRock to be managing director of the enlarged workplace pensions business.
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Last month Aegon sold £6 billion of pension liabilities to Rothesay Life as part of its move away from the bulk annuities market. It did that as a result of EU Solvency II rules which change how much capital insurers have to hold.
Aegon has been putting substantial investment into building its own online pension savings platform in the UK, partly as that is an area where capital requirements are much lighter. It is understood to have no current plans to try to integrate BlackRock’s current IT platform over to its own.
The deal still needs regulatory approval and may not complete until the second quarter of next year.
Aegon UK reported a 1 per cent decline to £91 million in its underlying earnings before tax for 2015.