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(Bloomberg) -- Vanguard Group has raised about $4 billion of private debt to finance its acquisition of digital wealth platform Altruist.
The firm, the second largest asset manager globally, borrowed in the private placement bond market, according to people familiar with the matter, who asked not to be identified as the details are confidential. Companies tap that market to source funds directly from institutional investors like life insurers.
Bank of America Corp., Citigroup Inc. and JPMorgan Chase & Co. arranged the transaction, some of the people said.
Representatives for Vanguard, Citi and JPMorgan declined to comment. A representative for Bank of America did not respond to a request for comment.
Vanguard, which oversees about $13.3 trillion in global assets as of July 31, has been ramping up its efforts to expand into wealth management. It announced plans to purchase Altruist in August after making an initial investment in 2020.
Altruist provides technology that helps independent financial advisers manage their clients' money and run their businesses in one place. It once branded itself as a " modern custodian ," offering advisers an alternative platform in a market where incumbents like Fidelity Investments and Charles Schwab Corp. dominate.
Jack Bogle-founded Vanguard is one of the latest companies to raise debt in the private placement market, following deals from the National Football League and Chick-fil-A Inc. earlier this year.
Going the private placement route is an option for companies looking for privacy and flexibility, as it doesn't typically require the same securities filings for public debt sales.
