Thomas H. Lee Partners closed a deal to move portfolio company HighTower Advisors out of an older fund and into a continuation vehicle, a deal known as a single-asset secondary. Goldman Sachs, Neuberger Berman and Coller Capital were lead investors on the deal, through which TH Lee will remain lead investor in the company. TH Lee first invested in HighTower in 2018. Hightower announced eight M&A transactions this year, following four in 2019.
Thomas H. Lee Partners, L.P. (“THL”) and Hightower today announced that THL closed an innovative secondary transaction, reaffirming THL’s long-term commitment as an investor in Hightower. In addition to broadening Hightower’s investor base, this transaction provides both new and follow-on capital to optimize Hightower’s value-creation potential and growth strategy.
“Hightower’s innovation and leadership have changed the way advisors and clients view the financial advice industry, and we are delighted to have led a syndicate of investors who believe strongly in Hightower’s business strategy,” said Ganesh Rao, Managing Director at THL. “The additional capital will enable Hightower to continue to expand its institutional-class services to catalyze organic growth, while at the same time fueling the firm’s RIA acquisition strategy.”
“I am thrilled that THL, which has been a supportive partner for Hightower since 2018, has validated Hightower’s business strategy by committing to us for this next chapter of growth and value creation for clients, advisors and shareholders,” said Bob Oros, CEO of Hightower. “We are also very honored to have so many top-tier investors bringing fresh capital to support the expansion of our wealth management service organization and advisory businesses for many years to come. This is ultimately a statement about the quality of advisors we have at Hightower and the dedicated work they do on behalf of their clients.”
THL will maintain its position as Hightower’s lead investor through a new vehicle dedicated to Hightower that includes investments from funds advised by Goldman Sachs Asset Management, Neuberger Berman and Coller Capital. THL first invested in Hightower in 2018.
Brian Musto, Managing Director at Goldman Sachs Vintage Funds, said, “We seek to partner with premier sponsors to create solutions for high-quality investments, and this transaction is an excellent example of both. We’re excited to participate with THL in a transaction that will allow Hightower to continue to expand its platform and realize its next phase of growth.”
“We are pleased to be partnering with THL on another GP-led secondary transaction and are excited to join as partners in the next chapter of Hightower’s success,” said Ben Perl, Managing Director at Neuberger Berman. “We view Hightower as a market leader with a differentiated strategy and unrelenting focus on its clients. Through this transaction, we have been able to provide THL and Hightower’s management team access to additional capital and the time necessary to drive additional long-term value creation.”
The transaction will result in no change to the governance of Hightower or to its executive leadership team. Specific terms of the transaction have not been disclosed.
Hightower has 113 advisory businesses in 33 states, offering them services designed to catalyze and accelerate their organic and inorganic growth, including technology, compliance, accounting, payroll, human resources, investment management and marketing support. Advisory groups that partner with Hightower also gain access to capital, business development consulting, leadership and team development, economies of scale, deep industry relationships and a nationwide advisor community.
In 2020 through Nov. 30, Hightower has announced eight M&A transactions, following four in 2019. As of Sept. 30, 2020, Hightower’s assets under administration (AUA) were approximately $81.4 billion and its assets under management (AUM) were $61.6 billion.
Hightower is a wealth management firm that provides investment, financial and retirement planning services to individuals, foundations and family offices, as well as 401(k) consulting and cash management services to corporations. Hightower’s capital solutions, operational support services, size and scale empower its vibrant community of independent-minded wealth advisors to grow their businesses and help their clients achieve their vision of “well-th. rebalanced.” Based in Chicago with advisors across the U.S., the firm operates as a registered investment advisor (RIA). Learn more about Hightower’s collaborative business model at www.hightoweradvisors.com.
Securities offered through Hightower Securities, LLC member FINRA/SIPC. Hightower Advisors, LLC is a SEC registered investment advisor.
About Thomas H. Lee Partners, L.P.
Thomas H. Lee Partners, L.P. (“THL”) is a premier private equity firm investing in middle market growth companies, headquartered primarily in North America, exclusively in three sectors: Financial Services, Healthcare and Technology & Business Solutions. We couple our deep sector expertise with dedicated internal operating resources to transform and build great companies of lasting value in partnership with management. Our domain expertise and resources help to build great companies with an aim to accelerate growth, improve operations and drive long-term sustainable value. Since 1974, we have raised more than $25 billion of equity capital, invested in over 150 companies and completed more than 400 add-on acquisitions representing an aggregate enterprise value at acquisition of over $200 billion. For more information on THL, please visit THL.com.