GTCR Out of AIG Advisor Group Auction

The auction for AIG’s advisor unit has narrowed to two private equity bidders: Clayton Dubilier & Rice and Warburg Pincus, a source told peHUB. Two previously reported bidders, GTCR Golder Rauner, and strategic bidder Ameriprise, have dropped out.

Dealscape reported news of Ameriprise’s exit from the process last week.

The business includes three broker-dealer businesses: SagePoint Financial, FSC Securities, and Royal Alliance Associates. It’s a bit of a bummer that the one strategic buyer backed out, because one of the group’s main selling points is its access to its parent company’s resources, according to it’s website:

Where smaller broker-dealers may be limited in their success due to competition, lack of scale, economic environment, poor brand recognition and compliance, our access to AIG provides us with an unmatched competitive edge in our market. The power of AIG’s brand – reputation, integrity, reliability and innovation – provides a significant point of leverage for AIG Advisor Group and its member broker-dealer financial advisors.

Yikes. Well, I guess that’s going to be built into the price of a private equity buyout. The business has $92 billion in assets under management and is being considered for a price of below $200 million, according to our source and Dealscape.