Very cool stuff! glad you were able to witness it first hand. I've had small hitchhiker ones reproduce in my tank but never these big ones.
Info: Feather duster worms reproduce both sexually and asexually. Soft tube varieties reproduce sexually, but many form dense colonies of clones by a budding process called scissipary. In this process the posterior end of the worm breaks off and develops a new crown while the “parent” grows a new posterior.