BERWYN, Pa. - Envestnet, Inc. (NYSE: NYSE:ENV), a prominent technology and wealth management solutions provider, announced today that its stockholders have overwhelmingly approved the company's acquisition by Bain Capital. The approval was given during a special meeting, with a preliminary vote count showing approximately 99.33% in favor of the merger.
The affirmative vote from the stockholders fulfills another condition for the completion of the merger, following the expiration of the waiting period under the Hart-Scott Rodino Antitrust Improvements Act of 1976, which ended on September 3, 2024. Envestnet expects the transaction to be finalized in the fourth quarter of 2024, pending the satisfaction or waiver of the remaining standard closing conditions.
This acquisition comes as Envestnet continues to influence the growth of wealth management services, providing an ecosystem of connected technology and insights for over 25 years. The company boasts more than $6.2 trillion in platform assets, serving over 110,000 advisors, including major U.S. banks and wealth management firms, and more than 500 of the largest Registered Investment Advisors (RIAs).
Bain Capital, the acquiring entity, is a global private investment firm with a diverse portfolio, managing approximately $185 billion in assets. The firm has a history of expanding into various asset classes since its inception in 1984.
The company's communication included cautionary statements regarding forward-looking information, which are not guarantees of future performance. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected.
Envestnet's management highlighted the merger's potential benefits but also acknowledged the risks involved, including the possibility that the merger may not be completed as anticipated or at all, which could adversely affect the company's business and stock price. The forward-looking statements are based on current expectations and are subject to change.
The completion of the merger is subject to various conditions and approvals, and while the stockholder vote is a significant step forward, the company has cautioned that there is no certainty regarding the timing or completion of the merger.
This news is based on a press release statement issued by Envestnet, Inc.
In other recent news, Envestnet has reported an 11% revenue increase to $348 million in its second quarter results, alongside an adjusted EBITDA of $78 million, marking a 22% margin. However, the company's adjusted EPS of $0.55 fell short of guidance due to non-cash charges. Envestnet is also in the process of being acquired by Bain Capital, a development expected to be finalized within the next 30 days. DA Davidson, while acknowledging the company's strong performance, has maintained a Neutral rating on Envestnet shares due to the impending acquisition. The firm's price target remains at $63.00, closely aligning with the acquisition price. Despite a slight 1% decline in its data and analytics business, Envestnet's advisor count grew to over 110,000, indicating a 3% increase, while account growth was at 4%. These are recent developments for Envestnet, which continues to focus on organic growth and deep client relationships.
InvestingPro Insights
As Envestnet, Inc. (NYSE: ENV) approaches a pivotal transition with the approval of its acquisition by Bain Capital, investors and stakeholders are closely monitoring the company's financial health and market performance. In light of this, InvestingPro provides valuable insights into the company's current financial metrics and analyst expectations.
Despite not being profitable over the last twelve months, analysts are optimistic about Envestnet's potential, predicting that the company will turn a profit this year. This forecast aligns with the company's strategic direction and the anticipated synergies from the merger with Bain Capital. Moreover, two analysts have revised their earnings upwards for the upcoming period, suggesting a positive outlook on the company's financial trajectory.
InvestingPro Data highlights Envestnet's market capitalization, which stands at approximately $3.45 billion. While the company's P/E ratio is currently negative at -13.55, indicating that it has been operating at a loss, the PEG ratio of 0.12 suggests that investors may expect significant earnings growth relative to the share price. Additionally, Envestnet's Price / Book ratio is 6.68, which could be seen as high, reflecting a premium that investors are willing to pay for the company's book value.
It's also worth noting that Envestnet's stock generally trades with low price volatility, which could be a reassuring factor for investors seeking stability amidst the potential changes brought about by the acquisition.
For those interested in a deeper analysis, InvestingPro offers a comprehensive suite of additional InvestingPro Tips for Envestnet, providing further insights into the company's financial health and market prospects.
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