AssetMark Financial Holdings is looking to use the $275 million it hopes to raise with its initial public offering mainly to pay off debt, Chief Financial Officer Gary Zyla told ThinkAdvisor on Thursday, shortly after the firm’s shares started trading on the New York Stock Exchange under the ticker symbol “AMK.”
AssetMark’s current debt is about $250 million and “we plan to pay down half of that with today’s proceeds,” he said. It’s also keeping its eyes out for additional appealing acquisitions, he noted.
The turnkey asset management provider for independent financial advisors, which was acquired by China’s Huatai Securities Co. about three years ago, on Wednesday announced the pricing of its initial offering of 12.5 million shares of common stock would be $22 per share.
Shares, however, closed at $27.04 on Thursday. The offering was expected to close July 22, subject to customary closing conditions, AssetMark said.
“That’s a nice result,” Zyla said of the initial demand for AssetMark stock, adding the company recently finished a “very positive road show” of the U.S. in which it met with about 150 investors who had a positive reaction to its business model.
The firm’s platform currently serves about 137,000 investor households through about 7,600 advisors, he said, adding: “The types of advisors who would benefit from working with us are advisors who are looking to outsource and scale their business, and those can be either advisors who are affiliated with broker-dealers or they can be independent RIAs or in some cases they’re hybrids.”