Envestnet shares close higher after IPO prices low

Envestnet Inc., a Chicago company that provides Web-based services for financial advisers, expects to raise more than $31 million in net proceeds this week in an initial public offering.
OCT 26, 2010
Shares of Envestnet are rising even after the company, which provides Web-based services for financial advisers, priced shares of its initial public offering at the bottom of a reduced range. The Chicago company raised $63 million as Envestnet and its investors offered 7 million shares for $9 apiece. Envestnet cut its price range to $9 to $10 per share from $12 to $14 per share Wednesday. Envestnet Inc.'s services are used by about 8,400 financial advisers for about 175,000 investor accounts. Last year, with revenues of $77.9 million, it lost $872,000. Trading Thursday morning on the New York Stock Exchange under the symbol Ticker:(ENV) shares are up $1.17, or 13 percent, at $10.17. Half of Envestnet's shares -- or 3.85 million -- are being offered as common stock, with selling stockholders selling an equal amount. The company said in the filing that it will not receive any of the proceeds from the sales of common stock by selling stockholders. Meanwhile, the company is offering underwriters an option to buy up to 1.16 million additional shares of common stock to cover overallotments. The company estimates net proceeds at about $31.3 million, based on an offering price of $9.50, at the midpoint of the expected price range of $9 to $10. The total could reach as high as $36.4 million assuming the underwriters exercise the overallotment option in full. Envestnet said it intends to use the proceeds for general corporate purposes, including for selective strategic investments through acquisitions, alliances or other transactions. Envestnet's services are used by about 8,400 financial advisers for about 175,000 investor accounts, it said in its SEC filing. Last year, with revenues of $77.9 million, it lost $872,000. Its largest client is FMR Corp., the parent of Fidelity Investments, which accounted for 31 percent of revenue last year. Envestnet Inc. was founded in 1999 and has more than 400 employees.

Latest News

The advisor’s essential role as alternative investments go mainstream
The advisor’s essential role as alternative investments go mainstream

With doors being opened through new legislation and executive orders, guiding clients with their best interests in mind has never been more critical.

Advisor moves: Raymond James snags advisor teams from RBC, Wells Fargo, Thrivent
Advisor moves: Raymond James snags advisor teams from RBC, Wells Fargo, Thrivent

Meanwhile, Stephens lures a JPMorgan advisor in Louisiana, while Wells Fargo adds two wirehouse veterans from RBC.

Private equity’s courtship of retail investors irks pensions, endowments
Private equity’s courtship of retail investors irks pensions, endowments

Large institutions are airing concerns that everyday investors will cut into their fee-bargaining power and stakeholder status, among other worries.

J.P. Morgan Securities on the hook for $1.1M to advisor in back-pay dispute
J.P. Morgan Securities on the hook for $1.1M to advisor in back-pay dispute

Fights over compensation are a common area of hostility between wealth management firms and their employees, including financial advisors.

After Muni bond fund blow up, broker-dealers Osaic and Stifel Nicolaus face questions
After Muni bond fund blow up, broker-dealers Osaic and Stifel Nicolaus face questions

Plaintiff's lawyers are eying both broker-dealers for potential client complaints.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.