Goldman Sachs to acquire Neos for up to $2.25b cash and stock

Investing.com -- Goldman Sachs Group Inc. will pay up to $2.25 billion to acquire Neos Investments, expanding its presence in the actively managed exchange-traded fund market, according to a Bloomberg report early Wednesday.

The cash-and-equity transaction will bring a growing ETF issuer into the Wall Street bank's portfolio of offerings, according to Marc Nachmann, who leads Goldman's asset management division. Neos manages nearly two dozen options-based income ETFs with approximately $32 billion in assets.

These funds have gained popularity among investors in recent years due to their high-yielding distributions. The Neos platform delivers complex, institutional-level strategies to a wider range of investors.

"Neos has been on a tremendous growth trajectory," Nachmann said in an interview. "Active ETFs are a fast growing space in the asset-management business."

The acquisition will bring Goldman's ETF assets to approximately $130 billion.

Founded in 2022, Westport, Connecticut-based Neos has drawn inflows with flagship options-based funds that have delivered double-digit returns with monthly income distributions. The firm has highlighted its use of favorable tax treatment for its products to increase after-tax returns.

Troy Cates and Garrett Paolella, Neos co-founders, will join Goldman Sachs Asset Management as partners when the deal closes. The entire Neos team is expected to join the business.

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