Bain Capital to Buy Wealth Management Tech Firm Envestnet for $4.5 Billion
Wealth management technology company Envestnet Inc. has entered into a definitive agreement to be acquired by Bain Capital in a transaction valuing the company at $4.5 billion. Envestnet manages over $6 trillion in assets, oversees nearly 20 million accounts, and enables more than 109,000 financial advisers to better meet client financial goals through its comprehensive, integrated platform and unified digital experience.
Reverence Capital also agreed to participate in the transaction. Strategic partners BlackRock, Fidelity Investments, Franklin Templeton, and State Street Global Advisors have committed to invest in the proposed transaction, and upon its completion they will hold minority positions in the private company.
“The board and its advisers conducted a process to maximize value for shareholders,” said Jim Fox, board chair and interim chief executive officer of Envestnet. “I’m proud of what Envestnet has achieved over the years in becoming the leading wealth management platform in the industry.”
According to Envestnet, it has had great success enhancing the adviser and investor experience, and currently supports over 800 asset managers on its wealth management platform.
“Through its deeply connected ecosystem and innovative technology and data capabilities, Envestnet has built an industry-leading platform that the largest wealth management firms, [registered investment advisers] and broker-dealers rely on to power their businesses,” said Phil Loughlin, a partner at Bain Capital.
Under the terms of the agreement, which has been unanimously approved by the Envestnet board, Envestnet shareholders will receive $63.15 in cash for each share of common stock they own. The transaction is expected to close in the fourth quarter of 2024, subject to the satisfaction of customary closing conditions, including receipt of approval by Envestnet’s shareholders and required regulatory approvals.
“Given Envestnet’s scale and competitive advantages in an industry that benefits from strong fundamental tailwinds, we believe the company is strategically positioned to achieve its next phase of growth,” said Milton Berlinski, co-founder and managing partner at Reverence Capital Partners.
“This is a validation of Envestnet’s proven ability to operate at market-leading scale – serving more assets, accounts, and advisers and effectively connecting our company and our technology,” said Tom Sipp, executive vice president, business lines of Envestnet. “This is an exciting new chapter for Envestnet, our clients, our partners and our employees. Together with Bain Capital, we are committed to investing in our platform making it more customized, connected, and intelligent. As a private company, we can accelerate our ability to further elevate our market-leading platform with greater functionality and an even broader solution set that enables advisors to better serve clients at all stages of their financial life.”
Upon completion of the transaction, Envestnet’s common stock will no longer be publicly listed, and Envestnet will become a privately held company.
“This is a great outcome for Envestnet’s clients and employees, and one that maintains its entrepreneurial spirit,” said Bill Crager, co-founder of Envestnet. “Envestnet is exceptionally well positioned to continue to build a gateway to the future of financial advice. I couldn’t be more excited about the company going forward, its continued success and ability to serve more advisers – enabling them to deliver more holistic financial advice.”
Bain Capital LP is a private multi-asset alternative investments firm that works in numerous asset classes including private equity, credit, public equity, venture capital, real estate, life sciences, insurance, and other strategic areas of focus. The firm has offices on four continents, more than 1,750 employees and approximately $185 billion in assets under management.
Reverence Capital Partners is a private investment firm focused on three complementary strategies: financial services-focused private equity; opportunistic, structured credit; and real estate solutions. It manages in excess of $10 billion in AUM.
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