UBS plans to acquire Wealthfront for $1.4 billion

UBS is planning to acquire automated wealth management provider Wealthfront in an all-cash deal valued at $1.4 billion.

Founded in 2008, Wealthfront raised over $204 million across 6 rounds of financing to develop a banking software that doesn’t require any branches and doesn’t require a consumer to talk to anyone. It targets “millennials who save” and got its start as a robo-adviser but has been pushing further into banking with a cash account and access to instant cash.  It has over $27 billion in assets under management and over 470,000 clients in the US.

As UBS looks to establish and grow relationships with additional affluent clients, Wealthfront’s capabilities and its focus on millennial and Gen Z investors will become the foundation of its new digital offering which will also include access to remote human advice.

“Partnering with UBS will allow Wealthfront to offer our clients additional value-added services and best in class research that will help accelerate our vision to make growing wealth delightfully easy. We couldn’t be more excited to have found a strategic partner who has the same view on the power of technology as we do. We look forward to providing our service to even more millennial and Gen Z investors.” – David Fortunato, Chief Executive Officer of Wealthfront.

Wealthfront will become a wholly owned subsidiary of UBS and will operate as a business within UBS Global Wealth Management Americas. The transaction is currently expected to close in the second half of 2022, subject to closing conditions including regulatory approvals .