What You Need to Know
- The terms of the transaction value the combination of Northern Star and Apex at about $4.7 billion.
- Michael Kitces speculates that the deal may allow the firm to take on Schwab more directly.
- Apex says its digital custody and clearing platform has about $100 billion in assets under custody, including cryptocurrencies.
Apex Clearing and Northern Star Investment Corp. II, a special purpose acquisition company started by New York Islanders co-owner Jonathan Ledecky, have announced plans to merge.
As part of the deal, Apex is expected to become a publicly traded entity on the New York Stock Exchange. The terms of the transaction value the combined firm at about $4.7 billion.
“Big #AdvisorTech news,” tweeted industry blogger Michael Kitces on Monday. “@apexclearing going public via SPAC. Raising $850M cash in the process for growth. Seeing the opportunity to take on #Schwabitrade more directly?”
For the transaction, Northern Store is raising roughly $450 million from investors that include Fidelity Management & Research Co. In addition, the deal is set to give Apex some $850 million in gross cash proceeds.
Apex says its digital custody and clearing platform has about $100 billion in assets under custody. It’s added $14 billion in new assets and 3.2 million accounts so far in 2021, including over 1 million new crypto accounts.
Its clients include Stash, Firstrade Securities Inc. and Social Finance Inc., as well as Goldman Sachs’ digital consumer bank Marcus.
Following the closing of the deal, Apex CEO William Capuzzi and Apex President Tricia Rothschild will stay on in their current roles. Northern Star Chairwoman and CEO Joanna Coles, the former editor-in-chief of Cosmopolitan magazine, will join the combined firm’s board.