Acquisition puts Envestnet at top of TAMP list

MAY 02, 2013
Envestnet Inc. has acquired Prudential Financial Inc.'s Wealth Management Solutions unit in a $30 million-plus deal aimed at the continued growth of its wealth management platform. The turnkey technology provider last Friday announced a deal to pay $10 million in cash once the deal closes, plus a contingent consideration of up to $23 million in cash to be paid over the course of three years. The transaction is expected to wrap up by the early third quarter. With $22 billion in assets under administration — largely from institutional clients — Prudential's Wealth Management Solutions unit was only a small part of the overall operation, according to Prudential spokeswoman Theresa Miller. “We're really just pleased to have been able to find a buyer who can support the growth of the business,” she said. “Envestnet's products and capabilities already complement those of WMS.” The deal will “allow the business to expand, and given the size of the business at Prudential, it wouldn't have happened here,” she added. WMS employs about 90 people, many of whom are expected to move over to Envestnet, Ms. Miller said. Envestnet chief Jud Bergman said the deal “solidifies our presence in the bank channel.” The deal is significant for Envestnet: It will make the firm the No. 1 turnkey asset management platform, with $139 billion in TAMP assets as of the end of last year, according to Cerulli Associates Inc. It also will put the firm at the top of the list in terms of service providers by total assets, with $392 billion as of the end of last year, according to Money Management International. Last year, the firm bought tech provider Tamarac Inc. in a $54 million deal and Prima Capital Holdings Inc., a provider of research tools for institutional investors and banks, for about $13.75 million in cash. Envestnet's acquisition will allow it to tap more relationships with banks, noted Patrick Newcomb, a senior analyst at Cerulli. Envestnet already provides management account programs at broker-dealers, as well as due diligence and research, he added. “It seems that by acquiring Prudential's unit, Envestnet might be getting at the bank channels a little more,” Mr. Newcomb said.

Latest News

SEC begins onboarding DOGE staff, Reuters reports
SEC begins onboarding DOGE staff, Reuters reports

The agency is establishing a liaison team to partner with the efficiency task force on requests for network, systems, and data access.

Wealth Enhancement, Bluespring add new RIA partners
Wealth Enhancement, Bluespring add new RIA partners

The acquisitive firms' latest deals extend their presence with experienced teams in Texas and Wisconsin.

Blackstone buyout fund closes years late, billions short of initial goals
Blackstone buyout fund closes years late, billions short of initial goals

The alternative investment giant expects fundraising to wrap around the end of the month, effectively taking twice as long as peers that closed in the past year.

What Americans actually want in an advisory relationship
What Americans actually want in an advisory relationship

New research unpacks the top traits clients look for in an advisor, why some advice may leave people dissatisfied, and the factors that fuel trust.

Add Commonwealth Financial – a blockbuster – to the list of potential LPL targets
Add Commonwealth Financial – a blockbuster – to the list of potential LPL targets

Chatter about LPL, a behemoth, buying Commonwealth Financial Network, a boutique, has been building all week.

SPONSORED Retirement plan balances are flourishing. Why are so many advisors missing out on a $3 trillion opportunity?

Participants who receive professional 401(k) advice see higher returns on average, net, than those who don't.

SPONSORED Focus on clients, not compliance – why Gary Corderman found his fit with Farther

This wealth management platform finally delivers on the technology promises other firms couldn't - giving advisors a better way to scale and serve