At a glance
- The Denver-based RIA, which reports $111 billion in client assets, also added a $340 million revolving credit facility with a five-year maturity.
- The Goldman Sachs-led debt raise was oversubscribed by funders, which included BMO Capital Markets and JPMorgan Chase, according to the announcement.
- The refinancing will help drive further deals for the acquisitive Mercer Advisors and provide capital to invest in its people, wealth platform and client services, according to the announcement.
Mercer Advisors has refinanced $1.9 billion in existing debt through a syndicated term loan with a seven-year maturity, marking its entry into the syndicated loan market, according to an announcement. The Denver-based RIA, which reports $111 billion in client assets, also added a $340 million revolving credit facility with a five-year maturity. Bloomberg first reported on the move.
The Goldman Sachs-led debt raise was oversubscribed by funders, which included BMO Capital Markets and JPMorgan Chase, according to the announcement. The deal lowered Mercer Advisors' interest rate by 1.75 percentage points compared to its previous loan, with a further reduction to come as the firm pays down the debt, according to a spokesperson. That will help the RIA save about $35 million to $40 million in interest costs next year, plus $15 million in upfront financing costs, according to the spokesperson.
"Tapping the syndicated loan market for the first time is a milestone for our firm, and the reception we received from institutional investors speaks to the strength of the business we've built," Gün Keresteci, chief financial officer of Mercer Advisors, said in a statement.
The refinancing will help drive further deals for the acquisitive Mercer Advisors and provide capital to invest in its people, wealth platform and client services, according to the announcement. The move follows a period of growth for Mercer Advisors, driven in part by what the firm reports as double-digit organic growth, excluding markets, for two consecutive years.
Mercer is majority owned by private equity firms Oak Hill Capital, Genstar Capital and Altas Partners, with employees owning the remainder. The refinancing replaces private debt with lower-interest-rate paper and extends the financing timeline — a shift from the bilateral lender relationships that have typically funded RIA roll-ups toward the broadly syndicated market.
On Mercer's own numbers, the interest savings are roughly the size of a mid-market RIA acquisition, and the firm has said the financing and integration capacity supports continued dealmaking.
Reported by the Deals & PE desk. Published . Corrections