(Bloomberg) -- Private equity firm Genstar Capital agreed to buy financial planning conglomerate Cetera Financial Group Inc.
Genstar is paying about $1.7 billion for El Segundo, California-based Cetera, according to people familiar with the matter, who asked to not be identified because the financial terms weren't disclosed.
Cetera management will keep a “meaningful” ownership stake, according to a statement from the companies Tuesday. The deal is expected to close by the end of September.
Cetera controls a network of broker-dealers that offers various wealth and asset management services to both individuals and businesses, according to its website. It was the investment advisory division of RCS Capital, the brokerage founded by real estate investor Nicholas Schorsch.
The deal will provide Cetera with capital to invest in technology, operations and other systems to help its clients.
“We're excited to work closely with the team at Cetera to build on the company's longstanding leadership in the financial advice space, and to support the growth and success of its nearly 8,000 financial advisers across the country,” Genstar Managing Director Tony Salewski said in the statement.
Cetera's financial adviser for the deal was Goldman Sachs Group Inc., while Skadden Arps Slate Meagher & Flom LLP provided legal counsel. UBS Group AG and Deutsche Bank AG were Genstar's financial advisers, with Wilkie Farr & Gallagher LLP as legal counsel.
To contact the reporter on this story: Matthew Monks in New York at mmonks1@bloomberg.net
To contact the editors responsible for this story: Elizabeth Fournier at efournier5@bloomberg.net, Michael Hytha
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