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UPDATE: Envestnet Announces the Acquisition of Placemark Investments For $66M

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Envestnet, Inc. (NYSE: ENV), a leading provider of unified wealth management technology and services to investment advisors, announced today that it has entered into a definitive agreement to acquire Placemark Holdings, Inc., a firm that develops Unified Managed Account (UMA) programs and other portfolio management outsourcing solutions for banks, full-service broker-dealers and RIA firms.

Placemark's patented, industry-leading portfolio overlay and tax optimization service bolsters Envestnet | PMC's product and service offerings for investment advisors, who are increasingly turning to UMAs to meet diverse investor needs. The UMA structure builds on the success of previous-generation separately managed accounts, combining multiple investment products into one account and delivering automated rebalancing and customization services that allow for more tailored investment solutions.

“Placemark delivers an efficient model of investing through its focus on Unified Account Management and value-added overlay services, both of which are critical for fee-based financial advisors to meet the unique needs of their clients,” said Jud Bergman, Chairman and Chief Executive Officer, Envestnet. “This acquisition significantly expands Envestnet's presence in the full-service broker-dealer channel, giving us added resources to serve a broad spectrum of wealth management needs, while delivering increased value to our shareholders.”

Placemark had approximately $14 billion in UMA assets under management as of March 31, 2014, which would boost Envestnet to #5 on the list of top Unified Managed Account providers in the industry with $24.7 billion in assets, according to Cerulli rankings. Placemark CEO Lee Chertavian will join Envestnet as Group President of Envestnet | Placemark.

“Placemark has created significant momentum in delivering customizable UMA and overlay solutions to our customers, which is critical for simplifying the delivery of sophisticated and diverse strategies to investors,” said Lee Chertavian, Chairman and CEO of Placemark Investments. “Having access to Envestnet's broad wealth management platform solutions should accelerate many of our strategic initiatives, addressing our customers' existing and emerging wealth management needs.”

Envestnet will initially operate Placemark's web-based UMA platform technology in tandem with its platform, benefiting customers of both firms with overlay services and delivering Envestnet's sophisticated model management and rebalancing tools and reporting solutions to Placemark's clients. A full integration and consolidation is expected in 2016.

“We are excited to welcome the Placemark team to Envestnet and to deliver all aspects of our integrated platform and services to their clients, helping them achieve their business goals,” said Bill Crager, President, Envestnet. “Placemark's UMA focus and overlay solutions further our efforts to empower advisors with the tools and resources they need to deliver personalized service and better outcomes for their clients.”

Envestnet has agreed to acquire Placemark for $66 million in cash upon closing. The transaction is subject to customary closing conditions, including customer consents, and is expected to close during the second half of 2014. Raymond James & Associates served as financial advisor to Placemark Investments, Inc. Envestnet did not retain a financial advisor. Mayer Brown LLP acted as legal counsel to Envestnet and Goodwin Procter LLP acted as counsel to Placemark Investments, Inc.

 

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