Genstar Capital agreed to acquire a majority stake in Foreside Financial Group from Lovell Minnick Partners. Foreside provides services to clients in investment management around distribution and governance, risk management and compliance. CEO Richard Berthy and president David Whitaker will remain shareholders and continue to lead the business. Lovell Minnick invested in Foreside Financial in 2017.
Genstar Capital (“Genstar”), a leading private equity firm focused on investments in targeted segments of the financial services, healthcare, industrials, and software industries, today announced the signing of a definitive agreement to acquire a majority stake in Foreside Financial Group, LLC (“Foreside” or “Company”) from Lovell Minnick Partners (“LMP”). Foreside provides a robust offering of distribution solutions and governance, risk management and compliance (“GRC”) solutions to clients in the global asset and wealth management industries.
Established in 2005 and based in Portland, Maine, Foreside has quickly grown to become a U.S. market leader in the investment management industry, and enjoys an excellent reputation as a best-in-class service provider across its distribution and GRC solutions offerings. The Company is led by Chief Executive Officer Richard Berthy and President David Whitaker, who will remain shareholders and continue in their current management roles.
“Genstar has extensive experience in the investment management space, and we’re excited to be starting this new chapter with them,” said Berthy. “We share a strategic vision to broaden our current scope of products and services, underscored by the belief that there remains a significant need for outsourced fund and GRC services in the market. We want to be perfectly clear – maintaining first-class service for our clients is our top priority. With this support, we feel like we can grow and expand our client base while maintaining and upholding this standard.”
Sid Ramakrishnan, Principal of Genstar, remarked, “As one of the most respected outsourced solutions providers to many of the world’s leading asset and wealth managers, Foreside is uniquely positioned to help clients thrive and pursue growth opportunities in any regulatory environment. We are excited to work closely with Richard, David, and the rest of Foreside’s management team as they continue to scale the business and drive growth.”
Tony Salewski, Managing Director of Genstar, commented, “Foreside is a signature Genstar transaction, representing an opportunity to invest in a high-quality business in the asset and wealth management ecosystem supported by compelling secular GRC tailwinds. We look forward to this new partnership.”
LMP, a private equity firm focused on investments in financial services, fintech and related business services, partnered with Foreside in May 2017. In the four years since LMP’s investment, Foreside has grown extensively through its investment in both organic and inorganic initiatives.
“It’s been an amazing and rewarding journey to be a part of and support Foreside’s rise as a trusted leader in the distribution and compliance needs of the asset and wealth management industry,” said Spencer Hoffman, a Partner at LMP. “We have every confidence they will enjoy continued success in the future.”
“It has been a pleasure to partner with Foreside management as the Company expanded its service offering and professional team both organically and through acquiring strong firms in the sector,” said Jason Barg, a Partner at LMP.
The transaction is anticipated to close, subject to customary approvals, in the third quarter of 2021. Financial terms of the transaction were not disclosed.
Willkie Farr & Gallagher served as legal advisor to Genstar. Raymond James served as financial advisor, and Morgan Lewis served as legal advisor, to Foreside.
About Genstar Capital
Genstar Capital (www.gencap.com) is a leading private equity firm that has been actively investing in high quality companies for over 30 years. Based in San Francisco, Genstar works in partnership with its management teams and its network of strategic advisors to transform its portfolio companies into industry-leading businesses. Together with Genstar X and all active funds, Genstar currently has approximately $33 billion of assets under management and targets investments focused on targeted segments of the financial services, healthcare, industrials, and software industries.
About Foreside Financial Group
Foreside delivers comprehensive advice and best-in-class technology solutions to clients in the global asset and wealth management industries. Foreside distributes more than $1 trillion* of product through their 17 limited purpose broker-dealers. For 15 years, Foreside’s suite of services and platform-based model have helped automate and simplify compliance and marketing for clients. Foreside works with pooled investment products, investment advisors, broker-dealers, global asset managers, and other financial institutions.
By harnessing state-of-the-art technology, Foreside helps firms address and shape today’s regulatory environment, drive operational efficiency and growth, and focus on value-adding work. Foreside is headquartered in Portland, Maine, with numerous regional offices, including New York and Boston. For more information on Foreside’s suite of services, please visit www.foreside.com.
*as of 5/1/2021
About Lovell Minnick Partners
Lovell Minnick Partners (www.lmpartners.com) is a private equity firm focused on investments in financial services, financial technology and related business services. The firm partners with outstanding management teams to help grow their companies and build value for investors through a combination of driving growth initiatives, strategic activity and operational improvements. Since Lovell Minnick’s inception in 1999, it has become a leader in its chosen space, raising $3.5 billion of committed capital from leading institutional investors including public and private pensions, insurance companies, endowments and foundations. To date, Lovell Minnick has completed more than 50 portfolio company investments.
Lovell Minnick seeks to invest in management-driven, growth-oriented companies that span the supply chains of investment products, insurance products, credit products and payments. Some of the areas in which the firm specializes include financial and insurance technology; payments; specialty finance; insurance brokerage and services; asset and wealth management; and related business services.