TPG in Talks to Acquire Minority Stake in Creative Planning

By Milana Vinn and David French

(Reuters) – Buyout firm TPG has emerged as the frontrunner to pick up a minority stake worth $2 billion in Creative Planning, potentially valuing the wealth management firm at over $15 billion, sources reported on Saturday.

This acquisition would mark TPG’s second such investment in a wealth manager within a week, highlighting the growing demand for mergers and acquisitions in this lucrative sector. On Thursday, TPG secured a minority stake in Homrich Berg.

San Francisco-based TPG is expected to prevail in the auction for Creative Planning’s stake, which attracted interest from other buyout firms like Permira. The deal announcement could come in the next few days, as the discussions remain confidential.

If successful, TPG will join General Atlantic, which acquired a minority stake in Creative Planning in 2020.

Both TPG and Permira declined to comment, and Creative Planning did not respond to inquiries.

Wealth managers have historically drawn robust interest from private equity firms seeking steady cash flows, with the fragmented nature of the wealth management industry allowing rapid growth through acquisitions.

Creative Planning, based in Overland Park, Kansas, provides financial and tax planning, retirement plans, and business consultancy services, managing over $300 billion in assets as of the end of 2023.

Last year, Creative Planning agreed to purchase the personal financial unit of Goldman Sachs after the bank’s strategic shift in focus towards high net-worth individuals and away from consumer lending.

Founded in 1992 by Jim Coulter and David Bonderman, TPG managed approximately $229 billion in assets as of June, reflecting a 65% year-over-year increase. The firm, led by Jon Winkelried, reported a 60% rise in fee-related income from asset management in its latest quarter.