Envestnet to buy FolioDynamix for $195m

Envestnet, a US-based provider of wealth management technology, has agreed to acquire competitor FolioDynamix for $195m.

Envestnet to buy FolioDynamix for $195m

FolioDynamix provides end-to-end technology solutions for financial institutions, investment advisers and wealth management clients. Its platform supports 3.2 million investor accounts and manages over $800bn in assets.

The combined entity will manage around $2 trillion in platform assets and serve nearly 10 million investors. Envestnet said that the deal will add complementary trading tools, commission and brokerage support to its existing product range.

The deal will be financed by cash on Envestnet’s balance sheet and borrowings under its revolving credit facility.

Envestnet expects tax benefits of approximately $10m and cost synergies of $20m from the deal. The firm also expects the deal to be immediately accretive to adjusted EBITDA and adjusted net income per share.

Envestnet chairman and CEO Jud Bergman said: “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.”

The transaction is expected to be wrapped up in the first quarter of 2018, subject to customary closing conditions such as receipt of certain third-party consents.