Goldman Sachs, on a bit of a buying binge now that David Solomon has taken over for long-time CEO Lloyd Blankfein, has purchased yet another consumer business.
The merchant banking division of the Wall Street giant announced Monday that it has acquired a company called Capital Vision Services (CVS), which manages an independent network of optometrists that are operated under the name MyEyeDr.
The purchase comes just a few weeks after Goldman Sachs made another splashy acquisition, buying wealth management firm United Capital last month for $750 million.
Solomon, a longtime Goldman veteran who was previously served as the co-head of the investment banking division before being promoted to president and chief operating officer, succeeded Blankfein in October. One month later, Goldman Sachs acquired financial spreadsheet firm ClearFactr.
The CVS/MyEyeDr deal is another example of how Goldman is trying to invest more in businesses for average consumers -- and not just provide high-end money management services for affluent clients as well as merger and underwriting advisory work for big corporations. Goldman Sachs is diversifying into more mainstream bread and butter financial services businesses — which tend to generate a steady stream of fees — at a time when many larger investors are worried about the possibility of more turmoil in the stock market.
For example, after Goldman Sachs launched Marcus, an online bank for average retail customers, in 2016, the company has made a series of acquisitions since then to bolster Marcus. It bought about $16 billion in deposits from GE Capital and has also acquired small business lender Bond Street, credit card startup Final and personal finance app Clairty Money in the past two years.
A huge deal for eyeglass prescriptions
The CVS/MyEyeDr deal was valued at $2.7 billion, a source close to the situation said. The purchase was made by West Street Capital Partners VII, a fund managed by the merchant banking division of Goldman Sachs.
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MyEyeDr, which plans to have 575 optometry practices running in 18 states by the end of the year, was previously owned by investment firm Altas Partners and the Canadian pension fund Caisse de dépôt et placement du Québec.
Goldman won't actually be running the operations. This is an investment. But Goldman said it bought CVS/MyEyeDr because of its health care chops.
"We look forward to partnering with this talented management team and building on their foundation of commercial and operating excellence. CVS has a proven consumer-directed health care model that champions optometrists and promotes eye health," said Jo Natauri, global head of healthcare investing for the Goldman Sachs merchant banking division, in a statement.
Bringing on fresh blood on the tech side
Several of Goldman's recent deals have also been dubbed so-called "acqui-hires," meaning that they helped bring in new talent on the tech side for Goldman Sachs at a time when many top students coming out of college and business school are looking for jobs in Silicon Valley instead of Wall Street.
Goldman Sachs announced in March that it was relaxing its dress code. It would allow its employees to be "flexible" (i.e. more casual) and not force all workers to wear jackets and ties or dresses and pantsuits in the office -- especially if they were not meeting with clients.
"We are on an evolutionary path," said Solomon, who moonlights as an EDM DJ under the name D-Sol, in the opening remarks of the company's earnings conference call with analysts in April.
The path has had some obstacles so far though. Shares of Goldman Sachs are down nearly 20% since Solomon took over, more than the drops of key rivals Morgan Stanley (MS), JPMorgan Chase (JPM), Citigroup (C) and Bank of America (BAC).