Evercore Wealth snags Mt. Eden in West Coast expansion

Latest RIA deal as managers look to beat capital gains hike

Nov 8, 2012 @ 1:59 pm

By Bruce Kelly

RIA
+ Zoom

Another large California-based registered investment adviser is off the block with the announcement Wednesday by Evercore Wealth Management LLC that it had agreed to acquire Mt. Eden Investment Advisors LLC, a San Francisco wealth manager with $645 million in client assets.

Last Friday, fast-growing Luminous Capital, which is based in Los Angeles and manages $5.5 billion, said it had sold itself to First Republic Bank.

Advisers who are in the process of selling their firms are intent on completing closure of deals before the end of the year, when it appears likely that the capital gains tax will go up, industry consultants and bankers said.

“If advisers are negotiating [a merger], they can benefit if it's finalized before Jan. 1,” said David DeVoe, managing partner of DeVoe & Co. “If they are not in negotiation, it's unlikely they can do that deal before the end of the year.”

Without a deal between President Barack Obama and Republicans in Congress, the Bush-era tax cuts are set to expire Dec. 31. Capital gains taxes would revert to a 20% rate, versus the current level of 15%.

Meanwhile, northern California is a particularly attractive area for establishing or expanding a presence because of the increasing wealth of executives in the technology sector.

“Organizations on the West Coast are in position to grow and show gains,” Mr. DeVoe said. “That part of the market is attractive.”

The fact that two large deals involving California firms were announced over the past week was partially “coincidental,” Mr. DeVoe said, adding that “the parts of the country that are experiencing growth will create more growth for RIAs. Good-size deals are brewing out there.”

A West Coast transaction had been a priority for Evercore.

“The expansion of our West Coast presence is an exciting step in our continued growth as a national firm,” Evercore chief executive Jeff Maurer said in a statement. The firm named three Mt. Eden executives as partners: Keith Williams, founder, CEO and chief investment officer; Tim Barrett, a founding principal, and Michael O'Brien, a senior portfolio manager and principal.

Terms of the deal were not disclosed.

Evercore Wealth Management was founded in 2008 and manages $3.8 billion in client assets.

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