NEW YORK–(BUSINESS WIRE)–Lightyear Capital LLC (“Lightyear”), a New York-based private equity
firm focused on financial services investing, today announced that
investment funds affiliated with Lightyear and the Public Sector Pension
Investment Board (“PSP Investments”), one of Canada’s largest pension
investment managers, have signed a definitive agreement to acquire AIG
Advisor Group, Inc. (“Advisor Group”), a subsidiary of American
International Group (“AIG”). The transaction is subject to customary
regulatory and other approvals. Terms of the transaction were not
Advisor Group is one of the nation’s largest networks of independent
financial advisors with more than 5,200 independent advisors and $160
billion in client assets under administration. Advisor Group provides
comprehensive broker-dealer services, technology, and advisory programs
through its four registered broker-dealers and Registered Investment
Advisors (“RIAs”): FSC Securities Corporation, Royal Alliance
Associates, Inc., SagePoint Financial, Inc., and Woodbury Financial
Services, Inc. The broker-dealers/RIAs operate within a single network,
positioning Advisor Group to provide a best-in-class, industry leading
Investment funds affiliated with Lightyear and PSP Investments will have
the majority of the seats on Advisor Group’s Board of Directors. Erica
McGinnis will continue in her role as Chief Executive Officer of Advisor
Group. Valerie Brown, former Chief Executive Officer of Cetera Financial
Group, a portfolio company of Lightyear Fund II, LP (“Lightyear Fund
II”), will be joining Advisor Group full-time at the closing of the
transaction and will serve as Executive Chairman of the Board.
In 2010, Lightyear Fund II acquired three independent broker-dealers
from ING which were rebranded as Cetera to build an integrated,
standalone firm. Under Lightyear Fund II’s ownership from 2010 to 2014,
Cetera became a leading independent broker-dealer/RIA network and grew
to approximately 6,600 advisors, up from 4,000 at the time of the
acquisition. Additionally, Cetera’s client assets under administration
grew to $148 billion, up from $75 billion at the time of acquisition.
Brown’s management team and Lightyear helped build and optimize the
platform to drive asset growth, operational efficiency, and enhanced
scale through several strategic acquisitions.
Mark Vassallo, Managing Partner of Lightyear, said, “We see enormous
opportunity to grow and expand Advisor Group, and we look forward to
working with Valerie Brown and Erica McGinnis, the Advisor Group
management team, the PSP Investments team, and the Advisor Group’s
high-quality advisor force to grow the company.”
“We are pleased to be acquiring Advisor Group. Lightyear’s commitment to
the asset and wealth management sector is substantial and one where we
have a deep heritage. We look forward to working with Advisor Group and
helping them expand the business,” added Donald B. Marron, Chairman and
Founder of Lightyear.
“We are pleased with this transaction, which is in line with PSP
Investments’ private equity strategy of making sizable, direct
investments in high-quality companies alongside experienced partners. We
see multiple growth levers to drive Advisor Group’s future performance
and look forward to collaborating with Lightyear and the Advisor Group
management team to deliver on that plan,” said Guthrie Stewart, Senior
Vice President, Global Head of Private Investments at PSP Investments.
Valerie Brown, incoming Executive Chairman of the Board of Advisor Group
stated, “I’m thrilled to work alongside Lightyear Capital’s team again.
I am confident Lightyear and PSP Investments will help Advisor Group’s
independent advisors thrive in this challenging marketplace. I have
known Erica McGinnis for several years and look forward to working with
“This acquisition marks an exciting chapter of growth for Advisor Group.
Lightyear and Valerie have proven track records of success in the wealth
management space. Together, we plan to grow the business and continue to
deliver world-class service to our advisors and their clients,” said
Erica McGinnis, Chief Executive Officer of Advisor Group.
About Lightyear Capital LLC
Lightyear Capital LLC is a financial services-focused private equity
firm based in New York. Lightyear, through its three affiliated private
equity funds, has raised over $2.5 billion of capital and makes
primarily control investments in North America-based, middle-market
financial services companies. Lightyear targets investments across the
financial services spectrum, including asset management, banks,
brokerage, financial technology, insurance, and specialty finance. The
firm brings strengths and discipline to its investment process, as well
as operating, transaction, and strategic management experience, along
with significant contacts and resources beyond capital. For more
information, please visit www.lycap.com.
About PSP Investments
The Public Sector Pension Investment Board (PSP Investments) is one of
Canadas largest pension investment managers with $112.0 billion of net
assets under management as of March 31, 2015. Its team of approximately
600 professionals manages a diversified global portfolio, including
public equities, private equity, bonds and other fixed-income
securities, real estate, infrastructure, natural resources, and private
debt investments. PSP Investments is a Crown Corporation established to
manage employer and employee net contributions since April 1, 2000 to
the pension funds of the federal Public Service, the Canadian Forces,
and the Royal Canadian Mounted Police, and, since March 1, 2007, of the
Reserve Force. PSP Investments’ head office is located in Ottawa,
Ontario, and its principal place of business is in Montreìal, Queìbec.
In November 2015, it opened its first international office in New York
City, USA. For more information about PSP Investments, please visit www.investpsp.ca.
About Advisor Group
Advisor Group, Inc. is the holding company for a network of independent
broker-dealers that is among the largest in the United States. The four
broker-dealers that comprise Advisor Group – FSC Securities Corporation,
Royal Alliance Associates, Inc., SagePoint Financial, Inc., and Woodbury
Financial Services, Inc. – are Registered Investment Advisors and
members of FINRA and SIPC. Advisor Group fosters the spirit of
entrepreneurship and independence exemplified by its more than 5,200
independent advisors across the US For more information, please visit www.advisorgroup.com.