Invesco has finalized an agreement to divest Intelliflo to Carlyle, a prominent global investment firm, with the transaction potentially reaching $200 million.
This agreement encompasses Intelliflo’s subsidiaries located in the United States, notably including RedBlack, a provider of SaaS-based portfolio rebalancing tools, as well as Intelliflo Portfolio, a software solution designed for portfolio management used by U.S.-registered investment advisers.
The financial structure of the deal entails an initial payment of $135 million upon closing, supplemented by an additional opportunity for up to $65 million in future earn-outs.
Invesco had initially acquired Intelliflo in June 2018.
Established in 2004 and headquartered in London, intelliflo specializes in cloud-based practice management software tailored for UK-independent financial advisers.
Its comprehensive software platform is utilized by over 30,000 users across 2,600 advisory firms, aiding in the management of approximately £450 billion in client assets.
The platform features a variety of functionalities, including CRM, financial planning, client onboarding, compliance workflows, and reporting capabilities.
The strategic intent behind this transaction is to bolster Intelliflo’s premier position in the UK market while catalyzing its expansion into Australia.
As part of the arrangement, the U.S.-based subsidiaries of intelliflo will be reorganized into an independent entity named RedBlack, overseen by a distinct management team.
This separation is envisioned to enable both enterprises to better cater to their respective clientele and market segments.
Intelliflo will prioritize delivering outstanding software solutions for the UK and Australian markets, whereas RedBlack will dedicate its efforts toward advisers in the United States.
Carlyle Europe Technology Partners (CETP), a €3 billion fund specializing in technology investments throughout Europe, will provide the equity needed for this investment.
Nick Eatock, CEO and founder of intelliflo, remarked, “This represents an exhilarating juncture for intelliflo. Carlyle’s investment demonstrates its faith in our organization, and its extensive experience in scaling technology companies renders it the ideal collaborator for our forthcoming phase of growth.”
“With Carlyle’s backing, we shall concentrate on delivering exceptional value to our clients, alongside a renewed commitment to pioneering solutions that align with the evolving requirements of our core UK and Australian customer bases.”
Fernando Chueca, managing director within the CETP investment advisory team, expressed enthusiasm about the partnership: “Intelliflo serves as a mission-critical software provider within the UK’s wealth management framework, boasting a deeply entrenched and loyal customer base.
We are eager to collaborate with Nick, Bryan, and the team to unlock the full potential of the company and usher in a new era of growth.”
Evercore acted as the financial adviser to Invesco, while HSF Kramer served as legal counsel. Due diligence for this acquisition was conducted by Altman Solon, PWC, Oliver Wyman, and Ringstone, with Gibson Dunn providing legal counsel to Carlyle.
Commenting on the deal in Money Marketing, FTRC founder Ian McKenna stated, “In a little over 20 years, intelliflo has evolved from acquiring an internal system within an adviser network to becoming the dominating force in the UK practice management sector, with a comprehensive offering suitable for nearly all advisory needs.”
“Additionally, they have consistently set themselves apart by being willing to collaborate with other tech vendors long before it became standard practice. The uncertainties surrounding ownership have lingered, making it gratifying to see it resolved, particularly with the existing management team retained.”
“This resolution will afford them the time necessary to address pivotal emerging issues in the financial advice arena, encompassing targeted support, simplified advice, and compliance with the Data Use and Access Act.”
Source link: Moneymarketing.co.uk.
