(Sharecast News) - UK pension provider PensionBee has announced it is expanding in the US through an exclusive agreement with an unnamed American financial institution as it looks to increase its share in the world's largest defined contribution pension market.
PensionBee said it would establish and manage its service in Delaware as a wholly owned subsidiary, including the hiring of a local team, with operational headquarters in New York, while the US partner will provide "substantial" marketing funding.
The company, which had £4.4bn of assets under administration and 250,000 invested customers at the end of 2023, will make available its online retirement proposition and UK-based proprietary technology to consumers in the US, home 80% of the global DC pension market representing $22.5trn in assets.
"Entry into a final binding agreement between the parties is subject to confirmatory due diligence, legal documentation and regulatory approvals, with launch expected in late 2024," PensionBee said in a statement.
"Given the context of the enormous US market opportunity, PensionBee sees the potential for its US business to grow rapidly, becoming at least the size of its UK business over the next decade," the company said.
Commenting on the deal, chief executive Romi Savova said: "By entering the world's largest Defined Contribution pension market, where many consumers still struggle to prepare adequately for retirement amidst an array of confusing and difficult to use investment options, our straightforward approach to online retirement savings will help millions of consumers look forward to a happy retirement."
The company said the deal would have no impact on its UK business's operations since they will be financially separate entities.
The stock was up 5.3% at 94.75p by 0947 GMT.
Pensionbee (PBEE)