NEW YORK , July 7, 2022 /PRNewswire/ -- Kingswood Acquisition Corp. (NYSE:KWAC ) ("KWAC "), announced today a definitive agreement to enter into a business combination with Wentworth Management Services LLC ("Wentworth ").
The transaction will enable Wentworth, a broker-dealer aggregator, to go public. As a result of the business combination, KWAC and Wentworth will become wholly-owned subsidiaries of Binah Capital Group, Inc., which will become a publicly traded company, subject to regulatory approvals. The combined entity is expected to encompass over 1,900 advisors, $25 billion in assets under management and over $285 billion in affiliated assets under management. The combined company will have a pro forma enterprise value of $208 million .
Transaction to Drive Wentworth's Future Growth, Operational Enhancements
Wentworth owns and operates four broker-dealers, located in 535 offices in all 50 states. Affiliated financial advisors have the optionality to choose from operating models that include a hybrid open architecture platform, independent registered status, and a W2 advisor model. The platform provides a variety of custody and clearing firms to accommodate the unique business needs of advisors.
Craig Gould , President of Wentworth Management Services and expected to be President of Binah Capital, said, "The creation of Binah marks another milestone for the company and supports our vision of serving as the wealth management industry's best-in-class broker-dealer platform for financial advisors. By combining forces with KWAC, our organization will have access to the public equity markets, which we anticipate will provide capital to fund future growth initiatives and operational enhancements."
The terms of the merger agreement provide that all Wentworth's shareholders are maintaining their ownership positions in the company and will receive no cash proceeds. Shareholders stand to benefit from the merger as part of a long-term value creation strategy focused on future acquisitions and an enhanced strategic position in the independent space.
KWAC Sees Further Opportunities in Fragmented Sector
Gary Wilder , Executive Chairman of KWAC, said, "The $29.1 trillion U.S. wealth management industry is poised for its next chapter of aggressive growth, and firms making the right choice at the right time are aligning themselves with the strongest option available in a globally fragmented sector ripe for consolidation."
"The creation of Binah Capital Group between Wentworth and KWAC prepares Wentworth's network of advisors for the positive macro tailwinds in the wealth management space. At the same time, KWAC's team– who are widely recognized wealth management industry leaders – are excited to work with Craig and his exceptional team on capturing the multiple growth opportunities ahead for our combined company."
Michael Nessim , CEO of KWAC, said, "We're excited to create Binah Capital Group, a firm with a national scale and footprint that is well-positioned to succeed in a fast-evolving wealth management industry landscape. This transaction underscores the importance for wealth management firms to align themselves with organizations that have truly global reach, resources and expertise to accelerate their continued growth and make the most of multiple opportunities that industry, market and economic trends are creating. We're pleased to have supported this transaction and look forward to all that we can achieve together going forward."
Key Transaction Terms
The business combination is projected to generate gross cash proceeds of approximately $30 million , assuming no redemptions of cash in trust and an anticipated $15 million capital raise, which will be used to pay transaction expenses and provide growth capital for the business. The implied pro forma equity value of the combined company is expected to be ...
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