Truist Financial to Sell Sterling Capital Management to Guardian Capital Group for $70M
Truist Financial, based in Charlotte, North Carolina, has announced its intention to sell Sterling Capital Management, a subsidiary with $76 billion of assets under management at the end of December, to Guardian Capital Group in Toronto. The sale price is reported to be $70 million, with additional future payout incentives.
The decision to sell Sterling Capital Management is part of Truist’s larger strategy to realign and simplify its operations. This move follows a $750 million cost-cutting program announced last fall, which included workforce reductions, Business line consolidations, and a company-wide reorganization. Truist also plans to close 4% of its branches in March, with other strategic changes occurring at all levels of the organization, from the board of directors to the executive management team.
Sterling Capital Management, founded in 1970 and acquired by BB&T Corp. in 2005, will continue to operate as a standalone entity led by its existing management team under Guardian’s ownership. The sale is expected to close in the second quarter, and Sterling Capital’s CEO, Scott Haenmi, sees this as a “win-win-win” for the company, Guardian, and Truist.
This announcement comes amidst speculation about Truist’s larger insurance brokerage business. The company is rumored to be nearing a deal to sell its 80% stake in Truist Insurance Holdings to Stone Point Capital and Clayton Dubilier & Rice. Analysts have noted that while the sale of Sterling Capital is significant, the potential sale of Truist Insurance Holdings could offer substantial value.
Truist’s ongoing efforts to streamline its operations and balance sheet further indicate a commitment to long-term growth and profitability. This latest divestiture is just one example of how the company is strategically positioning itself for the future.
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In historic context, it’s worth noting that Truist Financial was formed in December 2019 through the merger of BB&T Corporation and SunTrust Banks. This merger created one of the largest financial services companies in the United States, with a combined balance sheet of $450 billion. Since then, Truist has been actively reshaping its business to adapt to the changing financial landscape and enhance its competitiveness. The sale of Sterling Capital Management reflects the company’s commitment to focusing on its core operations and maximizing value for its stakeholders.
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