Goldman Sachs recently forged its first M&A splash of the David Solomon era, scooping up United Capital in an advance to make its wealth effective by managing business support. Considerable acquisitions have been infrequent in the post-crisis world. Reason being, Wall Street firms focus on steering clear of the wrath of regulators and politicians. The Wall Street behemoth is pushing deeper into a moderate but stable wealth management industry in hopes of neutralizing the turbulence experienced in its once vaulted trading arm.
Goldman’s purchase of Newport Beach, at California for $750 million, is the largest purchase made by the company in two decades as reported by the Wall Street Journal. Gaining United Capital, a boutique firm that has $25 billion in assets, under management and more than 22,000 clients, instantly gives Goldman Sachs a larger footprint in wealth management and access to the state of art technology.
Kleinhanzi said that United Capital is a “fairly well regarded” investment guide; the firms’ clientele is impoverished when compared to the typical Goldman Sachs client. He claimed that regulatory filings show that United Capital’s average account size is in $300,000 range, as compared to the Gold man’s private wealth business which accounts for $50 million.
Along with adding new clients, Goldman Sachs wanted to earn United Capital to get its hands on the firm’s technology. United Capital’s financial advisers use a digital platform named FinLifeCX to expand their business, customize portfolios and stay connected with its clients.
Last year, Goldman Sachs sought to bolster the technology used to help regular people manage their money by attaining Clarity Money. Clarity Money is a personal finance app. It uses a machine learning and is a part of Marcus, the consumer bank Goldman Sachs launched in 2016.