Hightower Holding, a Chicago-based registered investment advisory, is adding a major institutional investment consultancy to its practice by taking a majority interest in NEPC LLC.
The deal is scheduled to be completed in 2025 and would bring the two firms under one parent company with combined assets under administration of $1.8 trillion and assets under management of $258 billion, the firms announced Monday. NEPC, founded in 1986, will continue to operate independently from Hightower and retain a 20% ownership in the firm, according to a spokesperson. Neither Hightower nor Boston-based NEPC would provide terms of the deal.
Hightower, founded in 2008, has been expanding its RIA base rapidly in recent years through acquisition, amid consolidation in the sector. The NEPC stake, according to Hightower, will bolster its access to institutional-quality investment research, alternative assets and outsourced chief investment officer capabilities for the private wealth segment of the market—which the firm noted is becoming more attractive to wealth investors.
For NEPC, the deal will create a “new growth channel” across its investment advisory and OCIO services in wealth management, the firms wrote.
After the deal closes, NEPC Managing Partner Mike Manning will join Hightower’s board of directors. Otherwise, Hightower wrote that NEPC is “expected to retain its culture, executive team, and investment process, ensuring no disruption to its existing business operations and client service.”
Bob Oros, chairman and CEO of Hightower, billed the deal is a “transformational combination” in a statement, noting the “distinctive opportunity that both businesses can offer the private wealth market when combined.”
The move is part of a newer trend of RIAs bringing on institutional investment and consultancy capabilities. Firms that originated as qualified plan advisories, meanwhile, are continuing to seek out wealth management divisions to grow their footprints.
Hightower provides investment, financial and retirement planning services to individuals, foundations and family offices, as well as 401(k) consulting and cash management services to corporations.
NEPC serves more than 400 clients representing $1.66 trillion in assets.
Moelis & Co. advised NEPC in the transaction, and Goodwin Proctor LLP gave legal counsel. Berkshire Global Advisors provided Hightower with advisement on the institutional investment consulting and OCIO industry, and Kirkland & Ellis LLP gave legal counsel.
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Tags: Bob Oros, Hightower Holding, investment consultants, Mike Manning, NEPC