September 28 (Reuters) – Open a new tab Buyout firm TPG (TPG.O) has emerged as the front-runner to acquire a $2 billion minority stake in Creative Planning, a deal that could swell the asset management company’s value to more than $15 billion, people said on Saturday.
The deal marks TPG’s second bet on asset managers in the past week, highlighting growing demand for deals in the sector that generates lucrative fee income for managers. On Thursday, TPG inked a deal to buy a minority stake in Omrich Berg.
San Francisco-based TPG is expected to be the winning bidder in an auction for Creative Planning shares, which has also attracted interest from other buyout firms including Permira, the people said, asking not to be identified as the talks are confidential. The deal could be announced within days, the people added. If the talks are successful, TPG would become one of the asset manager’s owners, along with private equity firm General Atlantic, which bought a minority stake in Creative Planning in 2020.
TPG and Permira declined to comment. Creative Planning did not respond to a request for comment.
Asset managers have traditionally attracted a lot of interest from private equity firms looking to back companies that generate steady cash flows. The fragmented nature of the asset management industry also means companies can grow quickly through acquiring competitors. Based in Overland Park, Kansas, Creative Planning provides services to businesses, including financial and tax planning, retirement planning and financial advising, and has more than $300 billion in assets under management as of the end of 2023, according to its website.
TPG’s agreement to acquire Goldman Sachs’ (GS.N) (Opens in a new tab) personal finance division comes after the Wall Street bank strategically restructured its wealth management division, which targets high-net-worth individuals, following Goldman Sachs’ exit from the consumer lending business last year. .
Founded in 1992 by private equity managers Jim Coulter and David Bonderman, TPG had total assets under management of about $229 billion as of the end of June, up 65% from the same period a year ago. The firm, now led by John Winkelried, reported a 60% increase in asset management fee-based revenue in the most recent quarter.
