UBS has agreed to acquire California-headquartered digital-only wealth platform Wealthfront as part of a wider plan to target scalable growth in the affluent investor space across the world. 

The all cash agreement to acquire Wealthfront, which has over $27bn of assets under management and more than 470,000 clients in the US,  valued it at $1.4bn. 

The deal, announced on 26 January, will allow UBS to accelerate its growth plans in the US, increase reach into the affluent segment as well as expand distribution and other capabilities.

UBS group chief executive Ralph Hamers said in a statement: "Wealthfront complements our core business in the U.S. providing wealth management to high net worth and ultra-high net worth investors through trusted relationships with financial advisors, and will enhance our long-term ambition to deliver a scalable, digital-led wealth management solution to affluent investors." 

After the transaction, which is expected to complete in the second half of 2022, Wealthfront will become a wholly-owned subsidiary of UBS and operate as a business within UBS Global Wealth Management Americas.

Based in Palo Alto, California, Wealthfront is a digital-only platform providing access to financial planning capabilities, banking services and investment management solutions with a focus on affluent millennial and ‘Gen Z' investors.

After integration, Wealthfront clients will also benefit from access to UBS' wealth management capabilities including content from its chief investment office, its global footprint alongside its shelf of products and services.

The move follows recent comments by Hamers about UBS' plans to target mass affluent customers worldwide via an offering that combines digital capabilities and access to human advice.

"It is clear that we should cater for the entrepreneurs, but we should also cater for that segment of the market that may not be completely digitally engaged, but also doesn't want to have 100 percent client-adviser coverage, but something in the middle." 

According to Hamers, the plan is to first make a push in the US before rolling out an offering to target affluent clients globally.