CG Carlyle Group Inc

SS&C Technologies Holdings Inc. said it agreed to acquire Citigroup Inc.'s alternative investor services business for $425 million.

The business includes Citigroup's hedge-fund services and private-equity fund services business.

In a news release on Monday, Citigroup said that the entire operations of the alternative investor services business, which includes roughly 1,500 employees, will be transferred to SS&C when the deal closes, which is set for the first quarter of next year.

The deal comes a day after Citigroup agreed to pay nearly $180 million to investors to settle Securities and Exchange Commission accusations that it made false and misleading representations concerning the risks of two hedge funds that ultimately collapsed during the financial crisis.

The case involved two Citigroup affiliates, Citigroup Global Markets Inc. and Citigroup Alternative Investments LLC, which consented to the SEC order without admitting or denying the findings.

Last year Citigroup and U.S. regulators reached a deal that included restrictions to prevent Citigroup from selling investments in hedge funds and private-equity funds to wealthy clients. Those new restrictions stem from a settlement between Citigroup and the SEC related to the bank's sale of certain collateralized debt obligations to clients in late 2006 and early 2007.

Windsor, Conn.-based SS&C is a fund administrator for onshore and offshore hedge funds, funds of funds and private-equity funds.

Write to Tess Stynes at tess.stynes@wsj.com

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(END) Dow Jones Newswires

August 18, 2015 08:55 ET (12:55 GMT)

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