UBS has entered an agreement to purchase robo-advisor Wealthfront in an all-cash transaction valued at $1.4 billion, further broadening the firm’s reach in the U.S. among young, affluent investors, according to a Jan. 26 announcement.
Along with its wealth management platform providing access to financial planning, banking services and investment management solutions, the deal apparently will net UBS an additional $27 billion in AUM and more than 470,000 clients in the U.S.
“Wealthfront complements our core business in the U.S. providing wealth management to high net worth and ultra-high net worth investors through trusted relationships with financial advisors, and will enhance our long-term ambition to deliver a scalable, digital-led wealth management solution to affluent investors,” Ralph Hamers, Group Chief Executive Officer of UBS, said in a statement.
Wealthfront’s primary focus is on Millennial and Gen Z investors, who together will comprise a high-growth segment of more than 130 million investors in the U.S. alone, the announcement notes. In addition, Wealthfront will expand UBS’s existing offering through the firm’s Wealth Advice Center and its Workplace Wealth Solutions business, which works with employees of corporate clients on equity plan participation, financial education and retirement programs.
Upon closing, the firm will become a wholly owned subsidiary of UBS and will operate as a business within UBS Global Wealth Management Americas. The transaction is currently expected to close in the second half of 2022, subject to customary closing conditions.
