Envestnet announced it will acquire PIEtech, the creator of the MoneyGuide family of financial planning applications.

MoneyGuide is a leading goals-based financial planning application used by financial advisors.

“Financial planning is a key component of our vision for enabling Financial Wellness,” said Jud Bergman, Chairman and CEO of Envestnet. “We have admired the MoneyGuide offerings for some time, and recently announced our collaborative partnership with Apprise Labs and the PIEtech team. With MoneyGuide’s financial planning applications more deeply integrated into Envestnet’s wealth management solutions, enterprises, advisors and their clients can benefit from a frictionless wealth management technology solution across the application stack, driving higher productivity and better client outcomes.”

Headquartered in Powhatan, VA, PIEtech is focused on helping individuals control their financial future and security by planning for it. MoneyGuide solutions – including MoneyGuideOne, MoneyGuidePro® and MoneyGuideElite – are integrated with more than 150 wealth management data and technology providers, and serve tens of thousands of financial advisors across enterprise, institutional and independent firms. Nearly two million financial plans have been created using MoneyGuide solutions in the past 12 months.

“We founded PIEtech in 1997 to empower financial advisors to use financial planning to efficiently motivate their clients to create, implement and maintain financial plans that best meet their lifetime financial goals,” said Bob Curtis, founder and co-CEO of PIEtech. “Now a leader in financial planning, the PIEtech team is excited to join forces with Envestnet, who will be a great partner for our customers. We are believers in Envestnet’s vision for enabling financial wellness, and look forward to engaging with our customers with an increasingly broad set of solutions to provide lasting value to financial advisors and their clients.”

Key Benefits

The acquisition of PIEtech is expected to provide a number of benefits to financial advisors, end clients and Envestnet, including:

  • Establishes Envestnet as a leader in financial planning solutions – a key component of the Company’s vision for enabling Financial Wellness, to a large customer base consisting of banks, RIAs and broker-dealers
  • Complements and extends Envestnet’s existing capabilities with Logix and Apprise, providing advisors and their clients with access to a full spectrum of financial planning capabilities
  • Allows for deeper integration of MoneyGuide software with Envestnet’s integrated technology platform, reducing friction and enhancing productivity for advisors
  • Expands the opportunity to offer a broad range of data-driven, financial plan-informed Financial Wellness solutions, both domestically and internationally over time
  • Delivers compelling financial benefits – growing and profitable subscription-based recurring revenue business model, and accretive to top-line growth, margins and adjusted earnings per share.

Transaction Details

Envestnet will acquire PIEtech for consideration consisting of $295 million in cash, subject to certain adjustments, and approximately 3.185 million shares of Envestnet common stock. Based on the closing price of Envestnet’s common stock on March 13, 2019, the total value of the consideration is equal to approximately $500 million. The cash portion of the consideration will be funded by a combination of cash on Envestnet’s balance sheet and borrowings under its revolving credit facility.

Envestnet expects the acquisition to be accretive to adjusted EBITDA, adjusted EBITDA margin and adjusted net income per share immediately. Envestnet also expects multiple opportunities for cross-selling, which would further enhance the financial benefits of this transaction.

The transaction is expected to close mid-year 2019 and is subject to customary closing conditions, including the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

Advisors

PJT Partners LP is serving as financial advisor, and Mayer Brown LLP is serving as legal counsel, to Envestnet. Raymond James & Associates, Inc. is serving as financial advisor and Womble Bond Dickinson LLP is serving as legal counsel to PIEtech.