Wells Fargo Dumps Asset Management Business to Private Equity Firms
Posted on 02/23/2021
Wells Fargo & Company (NYSE: WFC) announced that it has entered into a definitive agreement to sell Wells Fargo Asset Management (WFAM) to GTCR LLC and Reverence Capital Partners, L.P. This sale includes Wells Fargo Bank N.A.’s business of acting as trustee to its collective investment trusts and all related WFAM legal entities. Under the terms of the agreement, the purchase price is US$ 2.1 billion. The transaction is expected to close in the second half of 2021, subject to customary closing conditions. As part of the transaction, Wells Fargo will own a 9.9% equity interest and will continue to serve as an important client and distribution partner.
The Wells Fargo brand name has been tainted over a series of scandals with the bank.
WFAM is an asset management firm with US$ 603 billion in assets under management at December 31, 2020. Upon closing of the transaction, the new, independent company will be rebranded.
Wells Fargo Securities, LLC served as exclusive financial advisor, and Skadden, Arps, Slate, Meagher & Flom LLP served as legal counsel to Wells Fargo in connection with the transaction.
NOTE: Wells Fargo Asset Management (WFAM) includes Wells Fargo Funds Management, LLC; Wells Capital Management Inc.; Galliard Capital Management, Inc.; Wells Fargo Asset Management (International) Ltd.; Wells Fargo Asset Management Luxembourg S.A.; and Wells Fargo Funds Distributor, LLC.