Stone Point Capital LLC, a private equity firm focused on global financial services and related industries, has agreed to acquire a majority interest in the $117 billion independent broker-dealer Kestra Holdings. Stone Point will replace current partner Warburg Pincus LLC, and private equity firm Oak Hill Capital will remain a minority owner. The Kestra Holdings management team and a large number of Kestra-affiliated financial advisers and Bluespring-affiliated principals will retain equity positions in the company.
Bluespring Wealth Partners is the acquisition arm of Kestra Holdings.
Stone Point first invested in Kestra in 2016, supporting its spinout from NFP before becoming a minority investor in 2019. Stone Point then sold its minority interest to Oak Hill in 2022. The firm’s return as majority shareholder represents a strong vote of confidence in the management team, its mission, and financial services platform.
Specific financial terms of the transaction, which is expected to close in the first quarter of 2025, were not disclosed. No impact to Kestra Holdings’ employees, financial advisers or operations is anticipated in connection with the transaction, and advisers’ clients will not be required to repaper their accounts.
In its partnership with Warburg Pincus from 2019 to 2024, Kestra Holdings significantly expanded its value proposition by helping deepen its service and technology platform, building Kestra Investment Management and growing Bluespring Wealth Partners into an acquisition force, such as with the summer 2024 acquisitions of Rodgers & Associates Wealth Advisers, a $1.35 billion Pennsylvania firm, and Shelton Financial Group, based in Indiana and overseeing nearly $500 million in client assets.
According to Kestra Holdings, its recapitalization will provide additional fuel to an already robust growth engine, which includes recruiting, a service and technology platform, and a high-growth wealth management acquisition business. Kestra will remain focused on serving independent financial advisers by expanding its unique wealth management offerings in Kestra Financial and Kestra Private Wealth Services, as well as accelerating its acquisition of premium wealth management firms through Bluespring Wealth Partners, now led by Pradeep Jayaraman, president, alongside Chairman Stuart Silverman.
“We’re pleased with the successful partnership we had with Warburg Pincus and are excited to once again partner with Stone Point. [Its] expertise and partnership previously helped propel us along a successful path to establishing our unique value proposition – to support successful wealth management businesses with full and deep value while focusing on the life cycle of their entrepreneurial efforts,” said James Poer, chief executive officer of Kestra Holdings.
“Today, our priorities are to strengthen that value proposition as we continue building a destination of choice for independent, successful wealth management businesses and professionals. With support from Stone Point and Oak Hill, we will continue scaling our platform and growing our expertise in serving and acquiring established wealth management firms seeking a monetization path that respects their legacy,” Poer added.
Stone Point has over 25 years’ experience, having raised more than $35 billion in aggregate capital commitments to invest in more than 160 companies across 10 active verticals and 75+ sub-sectors. The investment activities of the firm are led by a seven-person, senior management team and supported by more than 80 investment professionals.
“We are thrilled to partner once again with James and the Kestra management team. We believe Kestra is a highly differentiated platform in the independent wealth management space and are excited to continue to strengthen Kestra’s value proposition and propel growth for the financial advisers it serves,” said Fayez Muhtadie, co-head of private equity at Stone Point.
“Our partnership with James and the talented team at Kestra has been exceptional. Kestra has built a worldclass platform, and we are confident that the organization will continue to thrive with Stone Point and Oak Hill as partners,” said Jeff Stein, managing director and head of U.S. financial services for Warburg Pincus.
Kestra’s business is divided into independent broker-dealer Kestra Financial, wirehouse support business Kestra Private Wealth Services, registered investment adviser-acquirer Bluespring Wealth Partners, investment outsourcer Kestra Investment Management, and trust and estate planning firm Arden Trust Company.
Stone Point is an investment firm based in Greenwich, Conn., with more than $55 billion of assets under management. Stone Point targets investments in companies in the global financial services industry and related sectors. The firm invests in alternative asset classes, including private equity through its flagship Trident Funds and credit through commingled funds and separately managed accounts.
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