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May 1, 2018

Hellman & Friedman to buy advisory firm Financial Engines for $3.02bn

Private equity firm Hellman & Friedman (H&F) has agreed to acquire Financial Engines, a California-based investment advisory firm, in an all-cash deal worth around $3.02bn.

Under the agreement, Financial Engines will be merged with Edelman Financial Services, an investment management firm in which H&F holds a majority stake. Financial Engines manages $169bn in assets, while Edelman oversees over $21.7bn in assets.

As per the agreed terms of the transaction, shareholders of Financial Engines will receive $45 per share in cash.

Financial Engines president and CEO Larry Raffone will retain his title at the merged entity and will also join its board.

“We see tremendous alignment and commitment to our vision, and we believe the H&F partnership and the combination with Edelman is the best path for us to achieve our long-term strategic objectives, while providing significant and immediate upside to our stockholders, employees and clients,” Raffone noted.

Edelman founder and chairman Ric Edelman will become chairman of financial and investor education of the combined group and will become its board member.

The deal already secured the nod of Financial Engines’ board of directors. It is expected to be completed in the third quarter of this year, subject to stockholder and regulatory approvals.

H&F partner Allen Thorpe said: “Financial Engines is a pioneer in the high-growth financial technology sector. It brings a competitively superior investment methodology to its trusted relationships with the largest employers and recordkeepers in America. We look forward to further investing in Financial Engines to accelerate its growth and success.”


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