New York-based ETF provider WisdomTree Investments has unveiled plans to offload its $58m stake in wealth management technology platform AdvisorEngine.
WisdomTree initially invested $20m in AdvisorEngine in 2016.
In 2018, WisdomTree announced a capital infusion of $30m in AdvisorEngine to support the latter’s acquisition of client relationship management (CRM) software provider Junxure.
However, the ETF provider stressed that the stake sale transaction has not been finalised.
WisdomTree expects a non-cash impairment charge of between $22m and $30m in connection with the sale, if materialised.
“The final impairment charge will be recognised and disclosed in our Form 10-K. We do not anticipate the exit of our investment will drive any asset attrition or change our organic growth outlook,” WisdomTree stated.
WisdomTree announced the stake sale plan along with its Q4 2019 update. The firm reported a net income of $4.3m in the quarter, versus a loss of $11.6m a year ago.
The firm’s operating revenues rose to $68.9m from $54.1m over the period. As of 31 December 2019, WisdomTree’s AuM totalled $63.6bn.
WisdomTree CEO Jonathan Steinberg said: “The performance track records of our funds remain excellent with thirty-five 4- or 5-star Morningstar rated funds across our ETF and UCITS product range.
“We’ve generated positive net flows in four of the past five quarters, adoption of our model portfolios by advisors is accelerating and we are excited by the recent launch of the Siegel-WisdomTree models.”
Notably, last month, WisdomTree made a strategic investment in Securrency, a blockchain-based financial and regulatory technology developer.
Around three months back, the ETF provider agreed to sell its Canadian unit to CI Financial.