The wealth management firm Edelman Financial said Monday that it would go private after accepting a $258 million bid from Lee Equity Partners, the latest private equity shop to go hunting for asset managers.
The all-cash deal for $8.85 a share is a 43 percent premium over the Edelman’s closing price on Friday on the Nasdaq. The deal for Edelman, which manages about $17 billion, is expected to close during the third quarter of 2012.
“The Edelman Financial Group has achieved a strong track record and is a clear leader in the independent financial advisor field,” Thomas H. Lee, president of Lee Equity Partners, said in a news release. “We are excited to partner with Edelman Financial’s management team, and we look forward to supporting the company’s continued expansion.”
Edelman, based in Houston, employs about 500 people throughout the United States, offering an array of wealth management and financial advisory services. The company first went public in 1999, and reached a peak trading price in 2007 of about $18 a share. Since then, the share price has experienced steadily declined, though it is well above its post-financial crisis lows.
Lee Equity Partners, a middle-market buyout firm that manages about $1 billion of assets, plans to keep Edelman’s current management team intact, according to the release.
In recent years, private equity firms including the Carlyle Group and Apollo Global Management have been snapping up asset managers in a bid to beef up their assets.