Focus Financial Partners Closes in on IPO

Focus Financial Partners has filed an amended S-1 form with the U.S. Securities and Exchange Commission (SEC) regarding its initial public offering (IPO). The company expects to price its 16.22 million shares in the range of $35 to $39 a piece, with an overallotment option for an additional 2.43 million shares. At the maximum price, the entire offering is valued at up to $727.30 million. The company intends to list its shares on the Nasdaq under the symbol FOCS.

The underwriters for the offering are Goldman Sachs, Merrill Lynch, KKR, BMO Capital Markets, RBC Capital Markets, SunTrust Robinson Humphrey, Fifth Third Securities, Keefe Bruyette & Woods, MUFG, Raymond James, Regions Securities and William Blair.

This is a leading partnership of independent, fiduciary wealth management firms operating in the highly fragmented registered investment advisor industry, with a footprint of 56 partner firms across the country.

Its partner firms primarily service high net worth individuals and families by providing highly differentiated and comprehensive wealth management services. These partner firms benefit from its intellectual and financial resources, operating in a scaled business model with aligned interests, while retaining their entrepreneurial culture and independence.

The firm described its finances in the filing as follows:

For the year ended December 31, 2017, we generated total revenues of $662.9 million, net loss of $48.4 million, Adjusted EBITDA of $145.2 million and Adjusted Net Income of $96.6 million. For the three months ended March 31, 2018, we generated total revenues of $196.2 million, net loss of $12.1 million, Adjusted EBITDA of $44.2 million and Adjusted Net Income of $28.3 million. Over the last three fiscal years, our total revenues, our net income, our Adjusted EBITDA and our Adjusted Net Income have changed at compounded annual growth rates (CAGR) of 26.7%, (259.2)%, 28.9% and 20.0%, respectively.

Focus Financial Partners intends to use the net proceeds from this offering to repay its debt, as well as for general corporate business purposes.

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