Mercer has reached an agreement to acquire the outsourced chief investment officer business of Vanguard Group.
The OCIO business, called Vanguard Institutional Advisory Services, provides investment management services for not-for-profit organizations and other institutional investors in the U.S., said a Dec. 5 news release. Vanguard's OCIO unit has $60 billion in assets under advisement.
The terms of the acquisition were not disclosed, confirmed a spokesperson for Mercer.
As part of the deal, Vanguard's OCIO team comprising about 120 people is expected to transfer to Mercer as full-time employees, upon completion of the transaction, which is expected to occur in the first quarter of 2024.
On an update on its website, Vanguard stated that as part of this sale, more than 1,000 clients, mostly nonprofit organizations and pension clients, will transition to Mercer.
"We did not make this decision lightly," Vanguard added in the update. "As the OCIO landscape evolves and grows increasingly complex, Mercer's deep commitment to this space gives us great confidence that it is uniquely well positioned to support our OCIO clients and crew over the long term."
Marc Cordover, U.S. investments and retirement leader at Mercer, said in the release that Vanguard's "differentiated investment philosophy, strength in the not-for-profit sector, and client-centric approach complements our global capabilities across OCIO and managing alternative asset classes."
Mercer has $16.45 trillion in global assets under advisement, according to the firm's website.
Vanguard, which has approximately $7.6 trillion in assets under management, could not be immediately reached for further details.
