UBS Goes Big and Buys Wealthfront
Posted on 01/26/2022
UBS Group AG inked a deal to buy Wealthfront Corp., an automated wealth management provider serving the next generation of investors. The deal is an all-cash transaction valued at US$ 1.4 billion. Through this acquisition, UBS will accelerate its growth ambitions in the US, broaden the firm’s reach among affluent investors and expand its distribution and capabilities. Wealthfront was exploring a sale back in late 2021.
With over US$ 27 billion in assets under management and more than 470,000 clients in the US, Wealthfront’s platform helps clients manage their wealth by providing access to financial planning capabilities, banking services and investment management solutions. Following the transaction, Wealthfront and its clients will benefit from access to UBS’s wealth management capabilities.
Wealthfront will become a wholly owned subsidiary of UBS and will operate as a business within UBS Global Wealth Management Americas. The transaction is currently expected to close in the second half of 2022, subject to closing conditions including regulatory approvals.
Wealthfront was known as a robo-advisor in the late 2010s. Wealthfront raised money from firms like Tiger Global Management, Benchmark Capital, DAG Ventures, Greylock Partners, Index Ventures, Ribbit Capital, Social Capital, and Spark Capital Growth.
UBS Investment Bank is serving as financial advisor to UBS and Sullivan & Cromwell is acting as legal counsel. Qatalyst Partners is serving as Wealthfront’s exclusive financial advisor and Fenwick & West is acting as legal counsel.