Solid start to wealth management deals in 2024: report

Solid start to wealth management deals in 2024: report
"We’re seeing continued deal flow of mid-sized and smaller RIAs, along with broker-dealers, too," one banker said.
APR 22, 2024

The first three month of 2024 were the second best start to the year on record for wealth management firms in regard to deal making and transactions, according to a new report from Echelon Partners, a boutique investment bank focused on mergers and succession planning in the wealth and investment management industries.

In the first quarter of the year, there were 90 announced transactions, according to Echelon, representing a 20% increase over the same period last year, when 75 deals were announced. The first quarter of 2024 was the second most active first quarter on record, according to Echelon's tally.

The rest of the year should continue to see a busy M&A market, according to the report. The wealth management industry is on track to announce a total of 330 deals in 2024, a moderate increase from the 321 transactions announced last year, according to Echelon's RIA M&A deal report, which the bank publishes quarterly.

The mergers and acquisition market for RIAs and wealth management firms has been booming for almost a decade and red hot since COVID 19, as both well-established buyers and newer aggregators began duking it out to buy firms. Even the spike in interest rates and record highs for stocks, both of which make acquisitions costlier, have not dampened the demand to buy registered investment advisors and broker-dealers.

"Regarding the frequency of deals, I don’t see that slowing down," said Peter Nesvold, partner at Republic Capital Group. "As long as we have a reasonably sound economy, we'll see the march upward of both size of the firms, with billions in assets, along with the frequency of mergers and acquisitions."

"We’re seeing continued deal flow of mid-sized and smaller RIAs, along with broker-dealers, too," said Larry Roth, managing partner at RLR Strategic Partners. "I think 2024 is going to be another good year for M&A."

Leading wealth management firms had a big impact in the first quarter, according to Echelon.

"While RIAs continue to dominate the overall wealth management buyer population makeup, this quarter’s largest transactions included a diverse group featuring RIAs, private equity firms, broker dealers, asset managers, and insurance companies," according to the report.

"LPL Financial announced the largest deal of the quarter, acquiring $100 billion in assets Atria Wealth Solutions in February," Echelon noted. "Other notable large transactions include Mariner’s acquisition of $90 billion in assets AndCo Consulting and Focus Financial Partners’ acquisition of management’s stake in $30 billion in assets SCS Financial."

Meanwhile, Echelon expects a slight uptick in transaction value and volume this year.

In the first quarter of the year, the average assets per deal maintained an upward trajectory, hitting $1.8 billion in assets, a slight increase from the $1.7 billion recorded in 2023, according to Echelon.

The investment bank projects that the average assets per deal for 2024 maintain above $1.8 billion in assets, signaling a modest rise compared to both 2023 and the first three months of this year's figures.

Hightower CEO talks private equity and M&A in the RIA industry

Latest News

SEC bars ex-broker who sold clients phony private equity fund
SEC bars ex-broker who sold clients phony private equity fund

Rajesh Markan earlier this year pleaded guilty to one count of criminal fraud related to his sale of fake investments to 10 clients totaling $2.9 million.

The key to attracting and retaining the next generation of advisors? Client-focused training
The key to attracting and retaining the next generation of advisors? Client-focused training

From building trust to steering through emotions and responding to client challenges, new advisors need human skills to shape the future of the advice industry.

Chuck Roberts, ex-star at Stifel, barred from the securities industry
Chuck Roberts, ex-star at Stifel, barred from the securities industry

"The outcome is correct, but it's disappointing that FINRA had ample opportunity to investigate the merits of clients' allegations in these claims, including the testimony in the three investor arbitrations with hearings," Jeff Erez, a plaintiff's attorney representing a large portion of the Stifel clients, said.

SEC to weigh ‘innovation exception’ tied to crypto, Atkins says
SEC to weigh ‘innovation exception’ tied to crypto, Atkins says

Chair also praised the passage of stablecoin legislation this week.

Brooklyn-based Maridea snaps up former LPL affiliate to expand in the Midwest
Brooklyn-based Maridea snaps up former LPL affiliate to expand in the Midwest

Maridea Wealth Management's deal in Chicago, Illinois is its first after securing a strategic investment in April.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.