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As part of its plan to offer clients remote advice, Zurich-based UBS is buying robo advisor Wealthfront for US$1.4 billion.

UBS says the all-cash transaction will ramp up growth in the United States and broaden its distribution capabilities.

Palo Alto, Calif.-based Wealthfront has more than US$27 billion in assets under management for over 470,000 clients. It targets so-called millennial and Gen-Z investors.

UBS said that the acquisition will become the foundation of a new digital platform that will also provide remote access to human advice.

The Swiss bank signalled plans for a U.S. digital advice model in its third quarter earnings announcement last October, saying it is “planning a differentiating offering and combining a winning digital experience with trusted human advice on a remote basis.”

Commenting on the acquisition, UBS group CEO Ralph Hamers said, “Adding Wealthfront’s capabilities and client base to our global investment ecosystem will significantly boost our ability to grow our business in the U.S.”

“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,” Hamers added.

The deal, which is expected to close in the second half (subject to regulatory approvals and other closing conditions), will see Wealthfront become a wholly-owned subsidiary of UBS and operate as a business within UBS Global Wealth Management Americas.