Lovell Minnick Partners Announces the Successful Recapitalization of Pathstone and Welcomes Partnership with Kelso & Co

Additional capital solidifies Pathstone’s position as an industry leader and further empowers the firm’s culture of growth and innovation

Philadelphia, PA - March 6, 2023 – Lovell Minnick Partners (“LMP”), a private equity firm investing in growth-oriented companies, today announced the successful recapitalization of Pathstone, an independently operated, partner-owned advisory firm offering comprehensive family office services and customized investment advice. The transaction includes a new strategic equity investment from Kelso & Company (“Kelso”), a leading private equity firm focused on partnering with middle market companies.

LMP, which has been a crucial and impactful partner in Pathstone’s exciting growth since 2019, will continue its investment in the business and deploy additional capital as part of the transaction. LMP’s new investment signals its continued excitement for Pathstone’s business model and position as an industry leader.

In recent years, Pathstone has enjoyed a remarkable period of expansion, growing to more than 350 employees – over 180 of whom are shareholders – serving families and individuals, family offices, and foundations and endowments representing more than $80 billion in assets across 17 offices.

“We are thrilled to continue our investment and relationship with the Pathstone team,” said Brad Armstrong, Partner at LMP and a Pathstone Board of Directors member. “We believe there is an industry tailwind favoring those who have made the necessary investments in their team, technology, and resources, and we’re eager to support Pathstone as it looks to accelerate its growth trajectory and M&A strategy.”

“As Pathstone’s differentiated position as “The Family Office” continues to resonate across our industry and propels our exciting trajectory, we have found in Kelso another investment partner who aligns with our values as a consistent champion of founder-led firms with employee ownership,” said Matt Fleissig, CEO of Pathstone. “Alongside LMP, their partnership will provide capital to further support our culture of growth and innovation, as well as resources and expertise to enable us to accelerate our strategic initiatives and deliver upon the multi-generational promise we make to our clients and employees alike.”

“Our success over the years has placed us in a position to be the destination of choice for employees, families, and firms who have done great things but realize they want and need more support and better advice,” added Kelly Maregni, President of Pathstone. “With this new capital and partnership, we will continue to build a best-in-class firm delivering industry-leading service while remaining true to our values of Innovation, Caring, Proactivity, Humility, and Passion.”

Kelso’s partnership approach is centered around providing capital necessary for investment in people, process, technology, and other value-added outcomes that drive business success, all while existing management controls and manages the day-to-day business. “Pathstone is an outstanding company with a differentiated value proposition and excellent management team,” said Steve Dutton, Partner at Kelso. “With a shared vision for the future, we look forward to partnering with LMP and supporting Pathstone’s leadership during this next important phase of expansion.”

Kelso’s and LMP’s respective investments are expected to close during the second quarter of 2023 and are subject to customary closing conditions. Ardea Partners LP served as the exclusive financial advisor, and Alston & Bird LLP served as the legal advisor to Pathstone. Kirkland & Ellis LLP and Republic Capital Group advised LMP. William Blair & Co. provided financial advice, and Debevoise & Plimpton LLP served as the legal advisor to Kelso.

About Pathstone

Pathstone is an independently operated, partner-owned advisory firm offering comprehensive family office services and customized investment advice for families, family offices, and foundations and endowments. With decades of experience as trusted advisors, we employ an advocacy-focused model that empowers our clients to define and achieve their unique long-term goals and support their legacy. For more information, please visit here.

About Kelso & Company

Kelso is one of the oldest and most established firms specializing in private equity investing. Since 1980, Kelso has invested approximately $19 billion of equity capital in over 135 transactions. Kelso was founded by the inventor of the Employee Stock Ownership Plan (ESOP), and as a result, the principles of partnership and alignment of interest serve as the foundation of the firm's investment philosophy. Kelso benefits from a successful investment track record, deep sector expertise, a long-tenured investing team, and a reputation as a preferred partner to management teams and corporates. Kelso has significant experience investing in financial services, having deployed approximately $4 billion of equity capital in the sector. For more information, please visit here.