Creative Planning nears $640B AUM with SageView deal

The RIA giant Creative Planning is acquiring SageView Advisory Group in a deal set to bolster its expertise in retirement planning and more than double its assets under management.

Overland Park, Kansas-based Creative Planning announced Thursday that it was buying SageView, a Newport Beach, California-based firm managing roughly $250 billion in client assets and 36 offices. The acquisition will give Creative Planning nearly $640 billion in total assets, 550 advisors and roughly 80,000 clients in more than 90 countries. SageView specializes in helping clients retire, and the combined firm will manage roughly 11,800 retirement plans. The terms of the deal weren't disclosed.

A 'deal of necessity' to add retirement planning services

Creative Planning CEO and president Peter Mallouk said in an interview Thursday that he believes there will eventually be only a handful of large firms overseeing retirement plans for wealth management clients.

"So for us, this was a deal of necessity to get to the scale we needed to be, to be able to sit across the table from our clients and say, 'Hey, we're going to be able to do everything that you need us to do,'" Mallouk said.

Mallouk acknowledged that retirement plans are generally far less profitable for wealth managers than standard advisory accounts. Rather than the bottom line, Mallouk said he's more interested in ensuring Creative Planning can offer all the services clients have come to expect from advisory firms.

"We have a lot of other businesses that would be considered low margin, like our tax practice or our legal practice, or our practice that helps clients navigate term life insurance and things like that," Mallouk said. "If you're an individual or a business or institution and you want help protecting or transferring your wealth, we're in that business, and we want to solve that problem, no matter what the margin is."

Keeping custody relationships, shedding a broker-dealer

Mallouk said SageView uses Charles Schwab and Fidelity as custodians to help safeguard client assets and provide various types of technological support. Those deals won't change, he said.

SageView also uses Cetera as its broker-dealer for securities sales and similar transactions. That relationship will eventually go away, Mallouk said.

"Creative Planning is totally independent," he said. "We don't have an affiliation with a broker-dealer."

The private equity piece

Creative Planning is one of many large RIA acquirers that relies on private equity capital to finance its purchases. It has sold minority stakes in itself to the PE firms General Atlantic and TPG Capital.  Developments in Creative Planning's purchase plans were previously reported by the industry publications CityWire and WealthManagement.com.

The acquisition also marks the exit of the private equity firm Aquiline Capital Partners from SageView, which took a majority stake in the retirement specialist in 2021. Like many large wealth management firms, SageView has been growing through mergers and acquisitions in recent years. In August, it announced its purchase of Capital Strategies Investment Group, or Cap Strat, a retirement consultancy and wealth manager in Illinois with $25 billion in client assets.

"As Creative Planning continues to build their institutional retirement plan business, we are excited to be part of that process, leveraging our generations of expertise in this space and success in building one of the largest retirement-focused firms in the country," SageView CEO John Langley said in a statement. "Together, we will become the premier wealth management and retirement plan consulting firm."

— This article has been updated with comments from Creative Planning CEO and president Peter Mallouk.