Ameriprise Financial has acquired the long-term asset management business of Columbia Management from Bank of America for approximately $1bn in cash.

The transaction includes a five-year strategic distribution agreement that provides ongoing access to clients of Bank of America affiliated distributors, including US Trust.

Ameriprise Financial will combine its current US asset management business, RiverSource Investments, with Columbia Management under the Columbia brand. Threadneedle Investments will remain the company’s international investment platform. The RiverSource brand will continue for the company’s annuity and life, health and disability insurance products.

The US asset management business will continue to be led by William Truscott, CEO of US asset management and president for annuities. Michael Jones will continue to serve as president of Columbia Management and Colin Moore will continue to serve as chief investment officer.

Jim Cracchiolo, chairman and CEO of Ameriprise Financial, said: “The Columbia Management acquisition transforms our asset management capabilities and provides a platform to accelerate our growth. It enhances our scale, broadens our distribution and strengthens and diversifies our lineup of strong performing retail and institutional funds. Importantly, the transaction allows us to capture essential expense synergies that will be instrumental in driving improved asset management returns and margins over time.”