11 Aug Fintech Acquisition: Yodlee acquired by Envestnet
Last fall, Yodlee, an online hub for consumer financial apps, went public after 15 years as a private company. This week, and less than a year after going public, Yodlee was acquired by Financial services software company Envestnet at $18.88 per share in a cash and stock transaction. The total value of the transaction was approximately $660 million, which is nearly twice as high as Yodlee (based in Redwood City, Calif.) was valued in its initial public offering and shows a premium of about 50 percent to Yodlee’s closing price on Friday.
The two companies had discussed a commercial partnership for more than a year. But as the two sides spoke, they realized that an acquisition of Yodlee made more and more sense. Envestnet aims at building up its capabilities as it caters to financial advisers who are not affiliated with a big financial firms and banks. The idea behind the acquisition is that Yodlee, which gathers data from the likes of Credit Karma and LearnVest and puts it in one place, could provide Envestnet customers with a new tool for managing their clients’ money.
Judson Bergman, Envestnet’s chairman and chief executive, explains the rationale behind the acquisition as follows: “Yodlee enhances and strengthens the data-driven services that our advisers and enterprises and investment managers are looking to provide more of.”
Anil Arora, Yodlee’s chief executive, said that the decision to sell was driven simply by a recognition that putting the two companies together would help independent financial advisers compete against their rivals. “At the core, what we will do together is enable financial advisers to drive better relationships and lifetime value,” he said. “There’s an enormous transformation going on in financial services, and we’re going to accelerate that.”
