SEI has agreed to buy a majority stake in Stratos Wealth Holdings, as the firm aims to bolster its resources for financial advisors and registered investment advisors. 

SEI will acquire 57.5% of Stratos’ equity, which is worth about $527 million, in total cash consideration. The remaining 42.5% will continue to be owned by Stratos’ equity holders, and if they decide to sell, SEI will own 100% of the entity, the firm said. 

As part of the acquisition, Emigrant Partners will exit ahead of the finalization of the deal. Emigrant Partners purchased a minority stake in Stratos in 2020. 

In the strategic investment, SEI will play a key role in strengthening and developing Stratos Wealth Holdings’ approach to technology, custody, operations, and asset management. 

The deal will also prompt a renewed connection for wealth managers and RIAs who are driven towards seeking independence, growth capital, and scaling tailored opportunities to enhance and serve their client base.  

The deal is expected to close in two phases. Stratos’ U.S.-based businesses, which represent about 80% of the transaction value, will close in the second half of the year, and the Mexico-based portion is set to close early next year. 

“As we look to the future of wealth management, this partnership enables us to help accelerate growth for advisors and wealth managers, solve succession and business transition challenges, and develop the next generation of professionals delivering advice,” Ryan Hicke, CEO of SEI, said. “We share Stratos’ deep respect for independence and look ahead with excitement as we build a long-standing partnership that can simplify the complex and amplify the value of advice.”  

Once the acquisition is completed, Beachwood, OH-based Stratos Wealth Holdings will continue to be led by CEO and founder Jeff Concepcion, and the firm will continue to “operate under its recognized brand and as an affiliated business of SEI,” the firm said.  

Stratos Wealth Partners, a division of Stratos Wealth Holdings, founded in 2008, serves as a breakaway option for financial advisors, and as an LPL-affiliated RIA and an office of supervisory jurisdiction. Stratos Wealth Partners oversees about $14.4 billion in client assets, according to its latest Form ADV updated in July. 

For the deal, Goldman Sachs served as financial advisor, and Alston & Bird served as legal counsel to Stratos. Wells Fargo served as financial advisor, and Holland & Knight served as legal counsel to SEI. 

SEI manages approximately $1.6 trillion in assets, according to the firm.