Focus Financial Partners Inc., one of the industry's first and largest RIA aggregators, today announced that it is considering a buyout offer from private equity firm Clayton, Dubilier & Rice that would result in Focus going private.

Focus Financial said it has entered into an exclusive agreement with Clayton, Dubilier & Rice “to engage in negotiations regarding the terms and definitive agreements whereby CD&R may potentially acquire Focus for $53 per share,” or $4.1 billion in cash. It also has a hefty $6 billion in debt, which could prompt CD&R to restructure the firm and initiate some asset sales after completing a transaction. A handful of Focus's partner firms are believed to generate a disproportionate share of its cash flow and divesting a few of these entities could help reduce its debt.

If the deal goes through, the New York City-based Focus will cease to be a publicly traded company, according to a news release. The company is a partnership of independent, fiduciary wealth management firms.

Focus said in the release that the exclusivity agreement was approved by a special committee that it formed in November 2022 to evaluate CD&R’s non-binding offer, and to explore alternative transactions.

“CD&R has communicated that its latest non-binding offer of $53 per share represented its ‘best and final’ offer and that it was submitted with the understanding that there would be no further price negotiations,” the release said. “CD&R has also proposed that the transaction would be subject to a non-waivable approval of a majority of the voting power of disinterested shareholders.”

The $53 per share purchase price represents a 36% premium to Focus' 60-day volume weighted average price as of yesterday's close, the company said. It noted that negotiations regarding definitive terms and agreements are ongoing. “Any transaction would be subject to the completion of due diligence, board and stockholder approval, regulatory approvals and other customary conditions,” it said.

The company said it will not issue any further comment until “a specific transaction is recommended by the special committee to, and approved by, the board.”

Focus went public in July 2018 at $33.00 a share. If it agrees to the CD&R offer, Focus shares would have performed roughly in line with the stock market. However, Wall Street has tended to view Focus shares as something of a proxy for the equity market, a perspective that has occasionally frustrated its management.