Added on May 2017 in M&A Issues
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Summary: It is undeniable that M&A in the RIA space is heating up and not only are the number of deals increasing but the size of the average deal is also rising. What is behind this trend? Why are independent business owners merging their firms into larger enterprises? The answer is that “scale matters” and real benefits can be derived from merging a smaller independent firm into an enterprise level independent organization.
Added on April 2017 in M&A Issues
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Summary: As retirement nears for aging wirehouse advisers, many are contemplating how they can cash out. And they are bumping into a trend that is sweeping across the industry: independent practices can sell for a higher value than wirehouse practices that are transitioned to other wirehouse advisers. One senior marketing executive at a major custodian calls it an arbitrage among platforms.
Added on April 2017 in M&A Issues
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Summary: Acquirers in the wealth management industry these days aren’t looking for sleepy one-person firms but those with specific characteristics.
Added on April 2017 in M&A Issues
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Summary: Many independent advisors will be relying on the greater fool theory to strike a rich deal. Independents know that larger institutions and roll-ups routinely overpay for an advisor’s book of business. The word on the street is that buyers frequently overestimate how much advisors can grow their business.
Added on March 2017 in M&A Issues
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Summary: A RIA’s size, the demographics of its clientele as well as its advisor force, and the owner’s ability to negotiate are the three main factors buyers use to value an advice practice, says the Wall Street Journal.
