Goldman Sachs has agreed to acquire NEOS Investments for up to $2.3 billion, adding about $30 billion in assets and expanding its business in actively managed exchange-traded funds.
Goldman Sachs Agrees to Acquire NEOS Investments
Goldman Sachs will acquire NEOS Investments in a cash-and-equity transaction valued at up to $2.25 billion. The final consideration remains subject to performance and service commitments tied to the deal.
The transaction is expected to close in the first quarter of 2027, subject to regulatory approval and other closing conditions.
NEOS manages 19 systematic options-based income ETFs and had about $30 billion in assets under management as of June 30. Bloomberg reported the ETF provider had grown to roughly $32 billion in assets, making it a fast-growing participant in the active ETF market since its launch in 2022.
The acquisition follows Goldman Sachs Asset Management’s purchase of Innovator Capital Management, which focuses on defined-outcome and buffer ETFs. Adding NEOS will expand Goldman’s range of options-based funds across income, buffer and managed-outcome strategies.
Deal Takes Goldman Sachs ETF Assets Above $130 Billion
Goldman Sachs expects the combined ETF platform to manage more than $130 billion in assets after the NEOS transaction closes. Around $80 billion will sit in active ETFs, positioning the asset manager as the eighth-largest active ETF provider based on Morningstar figures as of June 30.
NEOS built its business around options-based income ETFs designed to provide regular income through systematic investment strategies. Co-founders Troy Cates and Garrett Paolella will join Goldman Sachs Asset Management as partners after completion of the acquisition, while the wider NEOS team is also expected to move to Goldman.
“As investor demand for active ETFs grows, NEOS’ disciplined investment approach is highly complementary to our capabilities across buffer, managed outcome and income strategies,” Goldman Sachs Chairman and CEO David Solomon said.
Options-Based Income ETF Market Reaches $180 Billion
Goldman’s latest acquisition comes as assets held in derivative income ETFs continue to rise. The category has reached about $180 billion in assets after recording annualized growth of more than 70% since 2021, based on Morningstar figures cited in the transaction announcement.
Options-based income ETFs use derivatives as part of strategies aimed at generating income while managing exposure to market movements. Demand for these products has grown among individual and institutional investors seeking income and portfolio risk-management tools within an ETF structure.
The NEOS purchase adds another options-focused business to Goldman Sachs Asset Management after Innovator. Following completion, Goldman will operate NEOS alongside its existing ETF offerings as the firm expands its active ETF product range and overall assets under management.
For more information on accessing similar investment products on-chain, learn how to buy tokenized ETFs on exchange platforms.
Be the first to comment