PensionBee is looking to expand into America by entering into a strategic relationship with a large, US-based global financial institution.
Under the proposed deal, PensionBee will manage the operations of the US business, including the hiring of a local team, and will make its online retirement proposition and UK-based technology available to consumers in the American defined contribution market.
Entry into a final binding agreement between the parties is subject to due diligence, legal documentation, and regulatory approvals, with the launch expected in the latter part of this year.
PensionBee will deliver the US service through PensionBee Inc, which will be be established in Delaware as a wholly-owned subsidiary of PensionBee Group plc, with operational headquarters in New York.
PensionBee CEO, Romi Savova, said: “In the year of our 10th anniversary, having demonstrated underlying profitability, we have entered discussions with a view to deploying our award-winning customer proposition in the USA.”
Savova described this as a “transformative step” for PensionBee and for the group’s stakeholders.
“By entering the world’s largest DC pension market, where many consumers still struggle to prepare adequately for retirement, our straightforward approach to online retirement savings will help millions of consumers look forward to a happy retirement,” she added.
The US has the world’s largest defined contribution pension market, representing approximately 80 per cent of the global total and $22.5trn in assets.
PensionBee said it sees the potential for its US business to grow rapidly, becoming at least the size of its UK business over the next decade.
PensionBee added that the US-based partner will provide its “expertise and substantial marketing funding”.
Additionally, in the UK, PensionBee will continue to grow its market share in the £1trn DC pension market in accordance with current guidance on revenue growth and profitability, operating the UK business as financially separate to the US undertaking.
As at the end of 2023, PensionBee had £4.4bn assets under administration on behalf of approximately one quarter of a million invested customers.
tom.dunstan@ft.com
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