American fund manager BlackRock has agreed to acquire FutureAdvisor, a San Francisco-based financial advisory service.
FutureAdvisor offers technology-enabled advice capabilities including personalized advice, IRA and 401(k) accounts, tax-efficient portfolio management, mobile and web applications, online account enrolment, and multi-custodian support.
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Following the acquisition, FutureAdvisor will become part of BlackRock Solutions (BRS), which provides financial institutions with technology-enabled advice.
BlackRock said the combined entity will allow financial institutions to expand their advisory businesses by using technology to meet a growing consumer trend of engaging with technology to gain insights on their investment portfolios.
Though financial terms of the deal were not disclosed, according to Financial Times the deal could value FutureAdvisor at between $150m and $200m.
BlackRock head of retail technology Tom Fortin said: "As demand for digital wealth management grows, we believe that our combined offering will accelerate our partner firms’ abilities to serve the mass affluent in a convenient, scalable way."
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By GlobalDataBlackRock Solutions COO and global head Robert Goldstein said: "The acquisition of FutureAdvisor is an extension of BRS’ mission to help clients solve their most complex investment challenges through technology."
Subject to customary closing conditions, the transaction is scheduled to complete in the fourth quarter of 2015.
