Private equity firm Genstar Capital has agreed to purchase a majority equity stake in Cetera Financial Group, an independent broker-dealer network comprising around 8,000 financial advisers.
Cetera’s leadership team will have a “meaningful ownership” in the business. Financial terms of the transaction or the size of the stake were not revealed.
The broker-dealer said that the deal will offer “significant capital” to support investments in various areas such as technology, customer experience, operations, data and growth platforms.
Genstar managing director Tony Salewski said: “From its scale and breadth of solutions, to its leadership team and vision for the future of advice, Cetera is well-positioned to capitalise on long-term secular tailwinds in wealth management.”
Cetera will continue to operate under its existing brand and leadership. It will also retain its current organisational structure and will now operate through two core channels, traditional and specialty.
The transaction is expected to be completed in the third quarter of this year, subject to regulatory nod.
The deal comes five months after the broker-dealer started a review of its capital structure.
Cetera CEO Robert Moore said: “The successful conclusion of our capital structure review process represents the next milestone in our company’s strategic transformation that began in 2016. This outcome affirms our vision for the future of the financial advice profession and creates a powerful partnership to help make this vision a reality for the financial advisers and financial institutions we support.
“Working alongside Genstar, our entire organisation will continue to serve our adviser community by advancing our Advice-Centric Experience, which envisions a profession driven by high-calibre, planning-based advice for clients.”