Exploring Sale: AssetMark Enlists Moelis to Advise

Exploring Sale: AssetMark Enlists Moelis to Advise

In a strategic move, AssetMark Inc., a cutting-edge financial technology firm supported by the backing of Genstar Capital and Aquiline Capital Partners, has enlisted the expertise of the independent investment powerhouse, Moelis & Co., to spearhead the exploration of a potential company sale. Reliable sources, privy to the intricacies of the deal, have confirmed this development.

Gauging Strong Interest: AssetMark’s Remarkable Performance

Exploring Sale: AssetMark Enlists Moelis to Advise
Exploring Sale: AssetMark Enlists Moelis to Advise

Amidst a backdrop of robust performance, AssetMark has successfully generated substantial earnings, reflecting a remarkable trajectory. This achievement is highlighted by its year-to-date earnings before interest, taxes, depreciation, and amortization (EBITDA) ranging between $60 million and $70 million. Market insiders familiar with the situation further reveal that AssetMark is currently witnessing remarkable interest from prospective buyers, a notable share of which comprises private-equity entities.

First Bids and Positive Outlook

As the initial bidding phase draws to a close, it’s been reported that AssetMark’s prospects remain highly promising. Notably, one of the sources speculates that the purchase price could potentially amount to at least 12 times the EBITDA figures, a valuation that could potentially position the company at an impressive $720 million or more.


A Comprehensive Service Portfolio

Hailing from Concord, California, AssetMark is recognized for its diverse service portfolio catering to the financial domain. The company’s offerings encompass investment and consulting services tailored for financial advisors. Additionally, AssetMark extends its expertise to encompass relationship and practice management services, solidifying its position as a comprehensive solutions provider.

Navigating AssetMark’s Divisions

Navigating AssetMark's Divisions
Navigating AssetMark’s Divisions

At its core, AssetMark operates through distinct divisions, each contributing to its comprehensive service ecosystem:

1. AssetMark Trust

The AssetMark Trust division emerges as a pivotal component, rendering its services to an extensive network of over 75,000 investors and financial advisors engaged in asset management. This division underscores AssetMark’s commitment to enhancing investment outcomes and driving financial success for its clients.

2. Savos Investments

Within its portfolio, AssetMark boasts Savos Investments, a strategic entity specializing in “risk-managed” strategies. This division’s expertise in prudent risk management strategies contributes significantly to the company’s allure.

3. Aris Division: A Multifaceted Approach

Aris, another prominent division within AssetMark’s framework, extends a holistic range of services encompassing wealth management, retirement planning, and trust services tailored for both financial advisors and clients. The integration of Aris into AssetMark’s fold transpired following the company’s successful acquisition of Aris Corp. of America on December 31, 2014.

Aquiline and Genstar: Shaping AssetMark’s Journey

Aquiline and Genstar: Shaping AssetMark's Journey
Aquiline and Genstar: Shaping AssetMark’s Journey

The foundations of AssetMark’s trajectory can be traced back to the strategic acquisitions by Aquiline Capital Partners and Genstar Capital. In September 2013, the acquisition of Genworth Wealth Management from Genworth Financial Inc. for $412.5 million paved the way for the company’s evolution into AssetMark Inc.

A Legacy of Private Equity

A potential sale to a private-equity entity would mark a pivotal moment in AssetMark’s history. This prospective transition would represent the third instance of the company falling into the hands of private equity investors.

A Journey Through Ownership

Before becoming a part of Genworth’s portfolio, AssetMark operated under the banner of AssetMark Investment Services Inc. Notably, during this phase, the company secured backing from Lovell Minnick Partners, which had acquired a significant stake in the firm in 2000. The evolution continued, as Lovell Minnick eventually divested AssetMark to Genworth for $230 million in 2006.

Vision and Investment Expertise

In the backdrop of AssetMark’s strategic journey, Genstar Capital emerges as a strategic force to reckon with. Renowned for its investments within the enterprise value range of $50 million to $1 billion, Genstar prioritizes ventures exhibiting EBITDA exceeding $10 million. With a diversified investment focus spanning healthcare, software, financial services, and industrial technology sectors, Genstar’s influence continues to shape the industry landscape.


Aquiline Capital: Navigating Financial Horizons

Hailing from the vibrant financial hub of New York, Aquiline Capital emerges as a stalwart investor within the financial services sector. Their investment footprint spans a wide spectrum, encompassing banking, credit, insurance, investment management, and financial technology. With a history of strategic investments exceeding $2 billion since 2005, Aquiline Capital remains instrumental in fostering growth across 30 midmarket financial services enterprises.

In conclusion, AssetMark’s decision to collaborate with Moelis & Co. to explore a potential sale underscores its commitment to strategic evolution and growth. As the journey unfolds, the financial world awaits the outcome of this strategic exploration, poised to redefine the company’s trajectory within the industry.

Source: https://www.wsj.com/articles/pe-backed-assetmark-hires-moelis-to-explore-sale-1454507977

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