DST Systems has signed a definitive agreement to acquire ALPS for $250 million in cash. Once the deal closes, which is expected in the fourth quarter, ALPS will be marketed as “ALPS, a DST Company.”

ALPS employs 300 people out of Denver, Boston, New York and Seattle and had more than $3.274 billion in assets under management at the end of 2010. It is the holding company of ALPS Fund Services, ALPS Distributors and ALPS Advisors.

“This transaction represents a healthy and natural progression for each firm,” commented Ned Burke, CEO of ALPS Holdings, which turned 25 this year. “Our suite of asset servicing and asset gathering solutions aligns closely with DST’s business goals and objectives. This new relationship allows us to maintain our unique culture at ALPS, even as it empowers us to further grow our business.”

Tom McDonnell, DST CEO, added, “This transaction further underscores our commitment to expanding our distribution support and asset-gathering capabilities. With our recent acquisitions of Finix Business Strategies and Subserveo, the company is well position to capitalize on the distribution side of the asset management industry. ALPS has a proven track record of managing, servicing and distributing products across the asset management spectrum, and we look forward to their continued growth and success.”

DST offers software and services to the mutual fund, investment management and brokerage industries. The company said it expects to realize $5 million of annualized synergies in the two years following the close through rationalization of technology and service infrastructures.