Philadelphia-based FS Investments, which raises cash from individual investors to finance companies, has agreed to purchase Darien, Conn.-based Portfolio Advisers, a private-equity investor for institutions such as the Pennsylvania state teachers’ pension fund . They have agreed to combine into a single company so they can sell their products to individual and institutional investors.
Michael Forman, a Philadelphia lawyer who founded FS with Philadelphia developer David Adelman in 2007, will head the combined companies as chairman and chief executive officer. Brian Murphy, cofounder of Portfolio Advisors, will continue to run that business. The merger comes at a time when private-equity, private-debt and private real estate fund managers such as Portfolio Advisors have been hoping to attract more individual investors to supplement what has become a crowded market for institutional cash.
FS was launched by its founders in an effort to “democratize” investments in private companies. Its current funds include a range of private credit funds, business-development companies, closed-end real estate funds, and other products sold through outside brokers.