HighTower, one of the nation’s largest RIAs, is selling a substantial portion of its business to a private equity investor, which plans to add more money in the future.
The deal involves some of HighTower’s institutional investors selling their investments in the firm.
Thomas H. Lee Partners, a private equity firm that invests in middle-market companies, is buying a substantial part of HighTower in a deal that will close later this year or in the first quarter of 2018. The amount of this initial deal was not released. However, Thomas H. Lee will commit an additional $100 million in new capital after the closing, according to the announcement that HighTower made Wednesday.
HighTower says it will leverage Thomas H. Lee’s operating and business development capabilities to enhance its platform and build on its already strong growth momentum.
“Our partnership will help us reach more advisors and clients who refuse to settle for the industry’s status quo,” said HighTower CEO Elliot Weissbluth.
The firm has signed a total of 22 advisor teams so far this year, and in May 2017 executed its largest acquisition ever by purchasing 10 financial advisor teams from WealthTrust. The new teams, along with HighTower’s organic growth, have increased total client assets to approximately $50 billion, a 27 percent increase since the beginning of 2017.
Dave Pottruck, the former CEO of Charles Schwab and chairman of HighTower’s board of directors, remains one of the largest individual investors in the company. Weissbluth, HighTower’s founder and CEO, and Doug Brown of DLB Capital, HighTower’s first large institutional investor, are not selling any equity in this transaction.