Exclusive-TPG in lead to buy stake in Creative Planning at $15 billion valuation, sources say

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, in a deal that could value the wealth management firm at more than $15 billion, people familiar with the matter said on Saturday.

The deal would mark TPG’s second such bet on a wealth manager within a week and underscores the burgeoning demand for dealmaking in the sector that generates lucrative fee income for managers. On Thursday, TPG clinched a deal to buy a minority stake in Homrich Berg.

San Francisco-based TPG is set to prevail in an auction for the stake in Creative Planning that drew interest from other buyout firms, including Permira, the sources said, requesting anonymity as the discussions are confidential. The deal could be announced in the coming days, the sources added.

If the talks are successful, TPG would become one of the owners in the wealth manager, alongside private equity firm General Atlantic which acquired a minority stake in Creative Planning in 2020.

TPG and Permira declined to comment. Creative Planning did not immediately respond to requests for comment.

Wealth managers have traditionally attracted robust interest from private equity firms who like to back companies that generate steady cash flows. The wealth management industry’s fragmented nature also means companies can grow quickly through acquisitions of rivals.

Overland Park, Kansas-based Creative Planning offers services including financial and tax planning, retirement plans and financial consultancy for businesses, and managed more than $300 billion of assets at the end of 2023, according to its website.

Last year, Creative Planning agreed to buy the personal financial unit of Goldman Sachs, after the Wall Street bank undertook a strategic overhaul at its wealth management unit to focus on high net-worth individuals, following its exit from the consumer lending business.

Founded in 1992 by private equity executives Jim Coulter and David Bonderman, TPG had about $229 billion in assets under management as of the end of June, up 65% from a year earlier. The firm, which is currently led by Jon Winkelried, posted a 60% jump in fee-related income from managing assets in its most recent quarter.