AssetMark to Buy Voyant for $145M

Turnkey asset management platform provider AssetMark plans to acquire Voyant, a provider of Software-as-a-Service (SaaS)-based financial planning and client digital engagement solutions, in a cash and stock transaction totaling $145 million.

The news comes as Natalie Wolfsen takes the helm as AssetMark's CEO and Michael Kim becomes its president, after a management reshuffle was announced last week.

"Voyant's fit into the AssetMark platform aids in creating stronger client-advisor relationships," Wolfsen said in a statement. "This leads to more invested assets and greater loyalty on our platform, while also helping us attract new advisors in core and adjacent channels."

The Voyant acquisition "advances the AssetMark financial wellness vision by adding compelling digital capabilities" to AssetMark's platform, the companies said. That "vision encompasses a holistic approach to advice that supports the client's goals in a customized way."

The deal is being funded with $120 million in cash and $25 million in AssetMark stock and is expected to close in mid-2021, the firms said in a joint announcement Monday. Following the close of the transaction, Voyant will start to be integrated into AssetMark's systems and infrastructure.

AssetMark has $74.5 billion in assets under management and serves over 8,400 financial advisors with its technology, investment solutions and business consulting services.

Voyant serves more than 20,000 advisors across financial institutions and small advisor firms in Britain, Canada, Ireland and the United States.

Why the Acquisition "Makes Sense"

"The deal makes sense," Joel Bruckenstein, president of Technology Tools for Today (T3), told ThinkAdvisor Tuesday.

"Everyone is focusing on 'financial wellness' and or financial planning. This clearly will strengthen AssetMark's abilities in these areas, and it will give the Voyant products the distribution that they need," he explained.

"The significance of" the AssetMark and Invesco announcements on Monday is that "they both are positioned to go head to head with Envestnet," according to Timothy Welsh, president, CEO and founder of consulting firm Nexus Strategy.

(Invesco said Monday that it has combined five software businesses it acquired in recent years — Intelliflo UK, i4C, Jemstep, Portfolio Pathway and RedBlack — under the Intelliflo brand name.)

"It also shows the growing importance of having a robust wealth tech solution that spans investing [and] planning while all having a digital component," he told ThinkAdvisor Tuesday.

"The future of asset management distribution will be through digital pipes," Welsh predicted. "If you recall, Envestnet coined the phrase 'financial wellness' as a strategy several years ago to rationalize all of their wealth tech and data acquisitions with their asset management business, so both [AssetMark and Invesco] are playing catch-up."

Strategic Rationale

AssetMark expects the transaction will accelerate AssetMark's standalone growth prospects and strengthen the standalone growth prospects of Voyant, which will remain a separate subsidiary continuing to target enterprises and advisors in order to increase market share, the companies explained.

The transaction is also expected to deliver fast financial benefits and long-term revenue diversification, with the acquisition expected to be immediately accretive to AssetMark's adjusted earnings per share in 2021 and beyond, according to AssetMark.

"The acquisition also provides revenue diversification as Voyant's subscription-based revenue is not market or interest rate sensitive," the companies noted.

AssetMark and Voyant "have a shared vision for financial wellness," according to Wolfsen. "The acquisition of Voyant rapidly accelerates this vision, while providing enhanced benefits for our advisors and their clients."

Voyant's integration partner ecosystem includes Morningstar, Microsoft Dynamics and Intelliflo, the U.K. provider of advisor-focused digital solutions that Invesco acquired in 2018.