The new entity will be led by Robert Reynolds, president and CEO of Putnam. “Together, we can grow faster than we can grow separately,” Mr. Reynolds said Thursday.
Combining the two retirement businesses is part of a reorganization of the two companies, both of which are owned by Great-West Lifeco Inc. The announcement was made at a news conference Thursday by Mr. Reynolds and top executives of the Canadian parent company — R. Jeffrey Orr, chairman, and Paul Mahon, president and CEO.
Although the two retirement businesses will be combined under the management of Great-West, the other Putnam and Great-West businesses will remain “separate entities,” Mr. Mahon said.
Mr. Reynolds will retain his duties as president and CEO of Putnam, and he will become president and CEO of Great-West Financial in May upon the retirement of Mitchell Graye, according to a news release.
Mr. Graye also has been president and CEO of Great-West Life Co. U.S., a unit of the Canadian parent that has direct responsibility for Putnam and Great-West Financial. On Thursday, Mr. Reynolds became president and CEO of Great-West Life Co. U.S.
Mr. Reynolds said he has not decided whether the retirement businesses will become a single brand. For now, the two units “will closely coordinate the expertise and experience” of their respective operations, he said.
Mr. Reynolds said the two retirement businesses are complementary — Putnam focuses on medium- and large-market 401(k) plans while Great-West Retirement Services, the retirement unit of Great-West Financial, specializes in the small- to medium 401(k) markets, as well as the 403(b) and 457 plan markets.
“The transition starts today,” Mr. Reynolds said, adding that Charles Nelson, president of Great-West Retirement Services, will be in charge of the integration of the two retirement businesses.
Mr. Nelson and Edmund Murphy III, head of defined contribution at Putnam, report to Mr. Reynolds. “Charlie runs the Great-West book of business and Ed runs the Putnam book of business,” Mr. Reynolds said at the news conference.
Great-West Retirement Services was the sixth-largest DC record keeper, with record-keeping assets of $206.4 billion as of Sept. 30, according to the latest Pensions & Investments’ survey of record keepers. Great-West ranked fourth in the number of participants with 4.79 million participants. It placed 11th in the number of sponsor-clients with 29,221.
Putnam did not provide information for the P&I record-keeper survey.
Among DC money managers, Great-West placed 39th in the most recent P&I survey with $13.1 billion in assets under management as of Dec. 31, 2012. Putnam ranked 51st with $7.1 billion.