CHICAGO–(BUSINESS WIRE)–Envestnet (NYSE: ENV), a leading provider of intelligent systems for wealth management and financial wellness, today announced that it will acquire FolioDynamix, a provider of integrated wealth management technology solutions.
“Acquiring FolioDynamix advances our growth strategy and creates value for our shareholders,” said Jud Bergman, Chairman and CEO of Envestnet. “This acquisition, our sixth significant transaction since 2010, expands our industry footprint, allowing us to further leverage our operating scale and data analytics capabilities as we continue to build the financial wellness network and help our clients deliver better outcomes. Together, we will have the broadest, integrated suite of products and services for enterprises and financial advisors, boosting their productivity. We are eager to welcome and continue to serve FolioDynamix’s clients.”
FolioDynamix, an Actua company (Nasdaq: ACTA), provides financial institutions, registered investment advisors, and other wealth management clients with an end-to-end technology solution paired with a suite of advisory tools including model portfolios, research, and overlay management services. As of June 30, 2017, FolioDynamix platform solutions supported more than 3.2 million investor accounts with over $800 billion in assets. The acquisition will add complementary trading tools as well as commission and brokerage support to Envestnet’s existing suite of offerings.
“We are excited to join forces with Envestnet, enabling us to expand how we serve our customers,” said Joseph Mrak, Chairman and CEO of FolioDynamix. “Integrating FolioDynamix’s powerful trading tools into Envestnet’s unified wealth management, financial planning and data analytics platform offers each of our customers the best of both worlds.”
Envestnet will acquire FolioDynamix in a cash transaction for $195 million, subject to certain closing adjustments. As part of the transaction, Envestnet expects to acquire tax benefits valued at approximately $10 million. The transaction will be funded by a combination of cash on Envestnet’s balance sheet and borrowings under its revolving credit facility. Envestnet expects the transaction to be modestly accretive to adjusted EBITDA and adjusted net income per share immediately, and to achieve its post-integration financial performance goals, including approximately $20 million in identified cost synergies, within 36 months of closing. Cost synergies are expected to result from combining platforms, eliminating redundant functions and spending, and benefiting from increased scale and volume. While Envestnet expects multiple opportunities for cross-selling, these opportunities represent upside and have not been incorporated into the expected financial benefits of this transaction.
The transaction is expected to close in the first quarter of 2018 and is subject to customary closing conditions, including the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and receipt of certain third-party consents.
Advisors
J.P. Morgan Securities LLC is serving as financial advisor and Mayer Brown LLP is serving as legal counsel to Envestnet. Evercore is serving as financial advisor and Dechert LLP is serving as legal counsel to Actua.
About Envestnet
Envestnet, Inc. (NYSE: ENV) is a leading provider of intelligent systems for wealth management and financial wellness. Envestnet’s unified technology enhances advisor productivity and strengthens the wealth management process. Envestnet empowers enterprises and advisors to more fully understand their clients and deliver better outcomes.
Envestnet enables financial advisors to better manage client outcomes and strengthen their practices. Institutional-quality research and advanced portfolio solutions are provided through Envestnet | PMC, our Portfolio Management Consultants group. Envestnet | Yodlee is a leading data aggregation and data analytics platform powering dynamic, cloud-based innovation for digital financial services. Envestnet | Tamarac provides leading rebalancing, reporting, and practice management software for advisors. Envestnet | Retirement Solutions provides retirement advisors with an integrated platform that combines leading practice management technology, research and due diligence, data aggregation, compliance tools, fiduciary solutions and intelligent managed account solutions.
More than 57,000 advisors and 2,900 companies including: 16 of the 20 largest U.S. banks, 39 of the 50 largest wealth management and brokerage firms, over 500 of the largest Registered Investment Advisers, and hundreds of Internet services companies, leverage Envestnet technology and services. Envestnet solutions enhance knowledge of the client, accelerate client on-boarding, improve client digital experiences, and help drive better outcomes for enterprises, advisors, and their clients.
For more information on Envestnet, please visit www.envestnet.com and follow @ENVintel.
About FolioDynamix
FolioDynamix is leading the evolution of the wealth management experience, with an end-to-end technology solution paired with a suite of advisory tools including model portfolios, research, and overlay management services. Through our powerful technology platform, advisors can manage the entire client lifecycle from proposal generation to account opening to account management (trading and rebalancing) to reporting, all through a sophisticated but easy-to-use cloud-based solution. FolioDynamix is an Actua company (Nasdaq: ACTA). Visit www.foliodynamix.com. Follow us on Twitter @foliodx.
