By David French and Milana Vinn
(Reuters) – TPG has agreed to buy a minority stake in Homrich Berg, in a deal that values the wealth management firm at around $1 billion, people familiar with the matter said on Thursday.
As part of the transaction, TPG picks up an ownership stake in the company, which is currently controlled by its management team and private equity firm New Mountain Capital, the sources said, requesting anonymity as the discussions are confidential.
Wealth managers, such as Homrich Berg, have traditionally attracted strong interest from private equity investors, who like to bet on companies that generate steady cash flows. The wealth management industry’s fragmented nature also means platforms can often be scaled quickly through subsequent acquisitions of rivals.
TPG, New Mountain, and Homrich Berg did not immediately respond to requests for comment.
Atlanta-based Homrich Berg is an independent financial adviser and wealth management firm with offices in Georgia, Florida, South Carolina and Tennessee. It is a top-50 registered investment adviser in the United States, with more than $17 billion of assets under management, according to its website.
Homrich Berg has been seeking a new minority investor to provide growth capital for the company but also to allow New Mountain to partially exit its investment.
New Mountain invested in Homrich Berg in 2021, although the financial terms of the transaction were not disclosed.
(Reporting by David French and Milana Vinn in New York; Editing by Lisa Shumaker)
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