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Bain Capital Buys Stake In Carson Group

Tom Burroughes, Group Editor, July 15, 2021

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As part of the deal, Bain Capital purchased the equity interests from Long Ridge Equity Partners, which led a minority investment in the company in 2016.

Private equity house Bain Capital has made a strategic investment into Carson Group, the US organization providing services including wealth management. Bain’s move values Carson Group at more than $1.0 billion.

Carson Group will continue to operate under its executive leadership team, led by founder and chief executive Ron Carson, who will remain the majority owner. In conjunction with the transaction, Bain Capital purchased the equity interests from Long Ridge Equity Partners, which led a minority investment in the company in 2016.

The deal is an example of private equity firms pushing into the North American wealth management space. According to the second-quarter report this week by DeVoe & Company, there were 18 deals this year that included private equity buyers of RIAs and other wealth management entities. Private equity firms that have bought into wealth management firms and related fields include HGGC, Thomas H Lee Partners, Warburg Pincus, Long Arc Capital, and LLR Partners. There is debate on whether PE firms, which typically hold investments for five years before an exit, have a time horizon that aligns well with wealth managers that are, or should be, more about running money over the long haul. Defenders might argue that PE owners aren't fussed about hitting quarterly numbers, as is the case with listed firms running wealth businesses. 

Founded in 1983 by Carson and based in Omaha, Nebraska, Carson Group serves financial advisors and investors through its three businesses – Carson Wealth, Carson Coaching, and Carson Partners. It manages more than $17 billion in assets via an advisor network of 110 partner offices, including 30 Carson Wealth locations.

“Looking forward at this exciting inflection point, Bain Capital is the ideal fit for us – culturally and strategically. We wanted an investing partner who brings deep operational knowledge and resources to help further our efforts,” Ron Carson said. 

Bain’s own financial services and fintech investments have included Acorns, Applied Systems, AvidXchange, Billtrust, Corvus Insurance, esure Group, FleetCor Technologies, Nets, Nexi, Passport, SigFig, SquareTrade, Vertafore, and Worldpay.

"In a very large and highly fragmented market, Carson Group stands out with a differentiated value proposition for advisors and clients, and we are excited to help accelerate the growth and further build out a strategic platform reshaping the future of financial advice," Olof Bergqvist a managing director at Bain Capital, said. 

In conjunction with the transaction, Bain Capital purchased the equity interests from Long Ridge Equity Partners, which led a minority investment in the company in 2016.

Moelis & Company LLC acted as the exclusive financial advisor, and Quarles & Brady LLP served as legal counsel to Carson Group. Ardea Partners LP served as financial advisor, Kirkland and Ellis LLP as legal counsel, and KPMG LLP as accounting and tax advisor to Bain Capital.

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