(Reuters) - Ascensus Inc, the largest independent retirement plan and savings services provider in the United States, is exploring a sale it hopes could value it at close to $1 billion, including debt, according to people familiar with the matter.
Ascensus’ private equity owner, J.C. Flowers & Co, has retained investment bank Deutsche Bank AG (DBKGn.DE) to help run an auction for the company, the people said on Wednesday.
Annual earnings before interest, taxes, depreciation and amortization for Ascensus is around $70 million, one of the people added.
The sources asked not to be identified because the sale process is confidential. Representatives for Ascensus, J.C. Flowers and Deutsche declined to comment.
Drescher, Pennsylvania-based Ascensus specializes in record-keeping, administrative, and program management services for over 40,000 retirement plans and 3 million 529 college savings accounts. It also administers more than 1.5 million IRAs and health savings accounts. It manages $125 billion in assets, as of March 31, according to the firm.
Over the past few years the U.S. Department of Labor has passed rules requiring greater disclosure of 401(k) fees, which some providers have said makes it more expensive to be in the business.
In late 2013 Ascensus entered the 529 college savings plan market with its acquisition of Upromise Investments Inc from Sallie Mae (SLM.O).
J.C. Flowers had tried to sell the company in 2012, one of the people said.
Ascensus was once a part of Bisys Group Inc which was purchased by Citigroup in 2007 for $1.44 billion. Citigroup then sold the Retirement and Insurance services unit to affiliates of J.C. Flowers for $800 million.
Editing by Ted Botha