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Mercer Buys Vanguard’s Outsourced CIO Business

By John Manganaro

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Mercer and Vanguard announced this week that the former is buying the latter’s outsourced chief investment officer business, which provides investment management services for not-for-profit organizations and other institutional investors in the United States.

As part of the agreement, Vanguard’s roughly 120-person outsourced CIO team is expected to transfer to Mercer as full-time employees, upon completion of the transaction, which is expected to be in the first quarter of 2024.

In a statement, Marc Cordover, Mercer’s U.S. investments and retirement head, says the acquisition of Vanguard’s outsourced CIO unit will bolster its existing outsourced investment management and alternatives capabilities.

As Cordover notes, institutional investors and not-for-profit organizations continue to face a range of challenges, and there is increasing demand for global investment expertise to stay ahead of the curve.

Survey data published by Institutional Shareholder Service’s Chief Investment Officer publication shows Vanguard’s institutional advisory services unit reported having well in excess of 1,000 full-discretion clients and more than $52 billion in full-discretion assets as of June.

Mercer’s existing outsourced CIO business is significantly larger, according to the CIO survey, in which the firm reported just shy of 2,000 full-discretion clients and more than $275 billion in full-discretion assets.

Credit: AP

John Manganaro

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