T. Rowe Price has entered into a strategic collaboration with Goldman Sachs as the two firms look to offer public and private market solutions to the retail markets, specifically retirement and wealth investors.
The news follows several similar deals in the asset management industry as traditional managers look to partner with private markets firms and offer new products to individual investors, plan sponsors and participants, and financial advisors.
Goldman will invest up to $1 billion in T. Rowe, putting their ownership at around 3.5 percent.
Dee Sawyer, head of global distribution at T.Rowe Price, told II that the most exciting aspect of the partnership is the fact that both organizations can use each other’s strengths to their own advantage, with the corresponding strong reputation and distribution abilities of each driving value creation.
"Goldman Sachs is providing solutions, not only through their strong capabilities in asset management, but also through their partnerships and technology solutions,” she said. “What's exciting about this is we're launching co-branded solutions, and that makes it really easy for both teams to go out to market and to talk in parallel with our respective clients.”
Potential new products will include co-branded target-date strategies that take advantage of T.Rowe’s retirement expertise and the bank’s private markets capabilities as a third-party provider. In addition, the two firms will introduce a series of co-branded model portfolios that offer separately managed accounts, direct indexing, mutual funds, and private market vehicles specifically targeted to mass-affluent and high-net-worth clients.
Co-branding will allow both names to be on the new products, which will add consistency and reinforce the message of collaboration for potential investors, she added.
Greg Wilson, head of retirement and co-head of US third-party wealth at Goldman Sachs Asset Management, added that the strength and depth of T.Rowe in the market was a big draw, with the combined sales teams for the products likely to be well over 200. He said that the transparency of a combined, co-branded product will help clients to understand what they are buying, and why.
There will also be two multi-asset offerings: one that includes private equity, private credit, and infrastructure in a diversified portfolio and one that invests in U.S. public and private equity.
Both parties confirmed that there is additional room for further product launches and collaboration between the two firms in the future, both in the U.S. and potentially further afield.
In November 2024, Institutional Investor reported on the joint venture between State Street and Bridgewater, which was an effort to diversify the product lineups and client bases of both parties to allow them to tap into retail investors’ growing appetite for alternative strategies. Doing this meant they did not have to build capabilities from scratch or make acquisitions. Similar tie-ups include KKR and Capital Group and State Street’s previous collaboration with Apollo to launch the first ETF that includes public and private assets.
