THL completes secondary transaction

Boston-based Thomas H. Lee Partners announced the closure of what it calls an "innovative" secondary transaction as an investor in wealth management firm Hightower. The transaction, officials said, provides both new and follow-on capital to optimize Hightower’s value creation potential and growth strategy. The transaction will result in no change to the governance of Hightower or to its executive leadership team. Specific terms of the transaction have not been disclosed. THL will maintain its position as Hightower's lead investor through a new vehicle dedicated to Hightower that includes investments from funds advised by Goldman Sachs Asset Management, Neuberger Berman and Coller Capital. THL first invested in Hightower in 2018. Hightower, headquartered in Chicago, has 113 advisory businesses in 33 states, offering them services designed to catalyze and accelerate their organic and inorganic growth, including technology, compliance, accounting, payroll, human resources, investment management and marketing support. Advisory groups that partner with Hightower also gain access to capital, business development consulting, leadership and team development, economies of scale, deep industry relationships and a nationwide advisor community. “Hightower’s innovation and leadership have changed the way advisors and clients view the financial advice industry, and we are delighted to have led a syndicate of investors who believe strongly in Hightower’s business strategy,” said THL Managing Director Ganesh Rao. “The additional capital will enable Hightower to continue to expand its institutional-class services to catalyze organic growth, while at the same time fueling the firm’s RIA acquisition strategy.” Brian Musto, managing director at Goldman Sachs Vintage Funds, said, "We seek to partner with premier sponsors to create solutions for high-quality investments, and this transaction is an excellent example of both. We're excited to participate with THL in a transaction that will allow Hightower to continue to expand its platform and realize its next phase of growth." "We are pleased to be partnering with THL on another GP-led secondary transaction and are excited to join as partners in the next chapter of Hightower's success," said Ben Perl, managing director at Neuberger Berman. "We view Hightower as a market leader with a differentiated strategy and unrelenting focus on its clients. Through this transaction, we have been able to provide THL and Hightower's management team access to additional capital and the time necessary to drive additional long-term value creation." In 2020 through Nov. 30, Hightower has announced eight M&A transactions, following four in 2019. As of Sept. 30, 2020, Hightower's assets under administration were approximately $81.4 billion and its assets under management were $61.6 billion.

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