Global private equity firm Warburg Pincus LLC has agreed to purchase a majority interest in independent broker-dealer Kestra Financial Inc. from its current owner Stone Point Capital. The transaction is expected to close during the second or early third quarter of 2019. Financial terms were not disclosed.
Funds managed by Stone Point will maintain a minority stake in the company. Kestra’s management team will retain equity positions in the company, and it is anticipated that a number of advisors will retain equity positions in the company.
Kestra said that its recapitalization will help expand its efforts related to recruiting, advisor technology, and institutional and wealth management acquisitions.
“We’re excited to continue building an industry-leading wealth management organization. The independent advisor community has been responsive to our evolution and we are fortunate to serve the best,” said James Poer, CEO of Kestra Financial. “Our new relationship with Warburg Pincus, and continued relationship with Stone Point, will allow us to continue building on the shared success we have achieved.”
Stone Point Capital purchased Kestra in 2016, then known as NFP Advisors, from insurance brokerage and consulting firm NFP Corp. In August 2017, Kestra purchased H. Beck Inc., an independent financial advisor with 600 reps and $2.4 billion in assets under management, from Securian Financial Group for an undisclosed sum.
Kestra noted that there will be no impact to its employees and advisors associated with this transition, including no repapering requirement for advisors’ clients.
Headquartered in Austin, Texas, Kestra Financial supports more than 2000 independent financial advisors in delivering securities and investment advisory services to their clients. Kestra is the parent company of four registered investment advisors, including Kestra Investment Services, Kestra Advisory Services, Kestra Private Wealth Services, and Kestra Institutional Services.
Warburg Pincus has more than 50 years of private equity experience and has invested more than $73 billion in 855 companies worldwide, the company said.