Wealth tech provider Envestnet has agreed to purchase Virginia-based PIEtech, the creator of the MoneyGuide financial planning application, in a stock-cash deal worth $500m.
The MoneyGuide suite includes MoneyGuideOne, MoneyGuidePro and MoneyGuideElite.
The tools are currently used by over 150 wealth management data and technology providers, who tend to “tens of thousands” of financial advisers.
Envestnet said the purchase will complement its existing capabilities with client engagement platform Logix and Apprise Labs.
The deal consideration includes a cash payment of $295m and around 3.185 million shares of Envestnet common stock.
The cash element will be financed through Envestnet’s available liquidity and borrowings under its revolving credit facility.
The deal is expected to conclude in the middle of this year.
Envestnet anticipates the deal to be immediately accretive to adjusted EBITDA and adjusted net income per share.
The company also expects the acquisition to boost its subscription-based recurring revenue.
Envestnet chairman and CEO Jud Bergman said: “We have admired the MoneyGuide offerings for some time, and recently announced our collaborative partnership with Apprise Labs and the PIEtech team.
“With MoneyGuide’s financial planning applications more deeply integrated into Envestnet’s wealth management solutions, enterprises, advisers and their clients can benefit from a frictionless wealth management technology solution across the application stack, driving higher productivity and better client outcomes.”