Boston Private Financial Holdings Inc. has agreed to sell all of its ownership interest in Bingham Osborn & Scarborough LLC to members of Bingham's management team, who will then become the majority owner of Bingham.
As part of the deal, Kudu Investment Management LLC will acquire a minority interest in Bingham, as well.
Boston Private will receive approximately $21 million at closing and an eight-year revenue share, pursuant to the agreement. Upon deal completion, the company expects to record a pretax gain of about $18 million and a related tax expense of around $3 million to $4 million. The net financial impact will increase Tier 1 common equity by approximately $33 million.
Boston Private had approximately $4.7 billion of assets under management as of Sept. 30 and constituted approximately $17.4 million of revenue in Boston Private's wealth advisory segment, $11.9 million of operating expense, and $2.1 million of net income attributable to noncontrolling interests in Boston Private's financial results during the first nine months of 2018.
Broadhaven Capital Partners LLC served as financial adviser and Goodwin Procter LLP served as legal counsel to Boston Private in this transaction.
The deal is set to close in the fourth quarter.