Bain Capital to buy financial software vendor Envestnet in $4.5 billion deal

Berwyn, Pennsylvania-based Envestnet offers software for wealth managers and data for financial institutions and investment research firms.

Private equity firm Bain Capital will buy Envestnet in a $4.5 billion deal, with backing from a cohort of investors, including BlackRock and Fidelity Investments, the financial software vendor said on Thursday.

Berwyn, Pennsylvania-based Envestnet offers software for wealth managers and data for financial institutions and investment research firms.

Its clients include 16 of the 20 biggest U.S. banks and 48 of the 50 largest wealth management and brokerage firms. Reuters exclusively reported earlier this week that the firms were close to a deal that would value Envestnet at close to its stock price.

Bain Capital is offering $63.15 per share in cash.Envestnet's stock had closed at $63.07 prior to the Reuters report.

Last year, Envestnet added three new directors to end a board challenge from activist investor Impactive Capital that had been pushing the company to improve its performance by cutting costs. Envestnet is currently in a leadership transition. In January, CEO Bill Crager said he would step down from this role and continue with the company as a senior adviser starting in April.

The company had explored a sale in 2022 after being approached by potential buyers. Reuters reported in April that Envestnet was again up for sale.Envestnet reported a better-than-expected profit in the first quarter. Last month, it said it was working with heavyweights such as BlackRock, Fidelity Investments, Franklin Templeton and State Street Global Advisors to build custom investment strategies.