PE Firm GTCR To Acquire AssetMark At $2.7 Billion Valuation

Wealthtech Firm’s Board Unanimously Approves Transaction, Which Is Expected To Close In Q4
Michael Kim, CEO, AssetMark
Michael Kim, CEO, AssetMark

Wealthtech firm AssetMark said Thursday it signed a definitive agreement to be acquired by GTCR, a private equity firm with significant investment expertise in fintech, wealth and asset management.

As part of the agreement, GTCR will purchase a 100% interest in Concord, California-based AssetMark, whose stockholders will receive $35.25 per share in cash, representing a total equity valuation of about $2.7 billion, the firms said.

The transaction is expected to close in the fourth quarter this year, they said. Once it’s completed, AssetMark’s common stock will no longer be listed on any public market.

The completion of the transaction is not subject to any financing condition, according to the firms, which stated that the transaction will be financed with a credit facility and equity capital from funds affiliated with GTCR.

AssetMark’s Board of Directors unanimously approved the transaction and recommended the deal to its stockholders, according to the company.

Collin Roche, Co-CEO and Managing Director, GTCR
Collin Roche, Co-CEO and Managing Director, GTCR

After AssetMark’s board approved the transaction, the definitive agreement was signed and the transaction was approved by written consent of stockholders representing a majority of the outstanding voting interests of AssetMark, the firms said.

AssetMark has about $117 billion of assets on its turnkey asset management platform (TAMP), it said. The platform serves more than 9,300 advisors and over 257,000 investor households, according to the company.

AssetMark offers a large suite of technology solutions and service offerings that enable independent financial advisors to create and manage customized client investment portfolios, report and analyze performance, custody assets, attract new clients and grow their advisory businesses, AssetMark said.

“This transaction is a testament to the support and commitment” of Huatai Securities, AssetMark’s majority owner, “over the past seven years, and the hard work of the entire AssetMark team,” according to Michael Kim, AssetMark CEO.

“This transaction will deliver substantial value for our shareholders, supports key elements of our strategy, and creates new and exciting opportunities for our employees,” Kim said.

Michael Hollander, Managing Director of GTCR
Michael Hollander, Managing Director of GTCR

There has been a “substantial increase in the scale and profile” of AssetMark since Huatai became its majority owner in 2016, said Collin Roche, Co-CEO and Managing Director of GTCR.

GTCR plans to support AssetMark as the company pursues organic initiatives and M&A opportunities, according to Michael Hollander, Managing Director of GTCR.

Morgan Stanley served as exclusive financial advisor to AssetMark, and Davis Polk & Wardwell provided legal counsel for the deal.

UBS Investment Bank and Barclays served as co-lead financial advisors to GTCR and are providing debt financing support for the transaction. BofA Securities and Jefferies also served as financial advisors, while Kirkland & Ellis provided legal counsel and Paul Hastings provided regulatory legal counsel.

Jeff Berman, Contributing Editor & Reporter at Wealth Solutions Report, can be reached at jberman@wealthsolutionsreport.com.

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