A record 101 merger and acquisition transactions involving registered investment advisory firms took place during the first half of 2021, setting the stage for another record year of RIA M&A activity, according to a report by DeVoe & Co.
Last year, a record 159 transactions took place, the report said.
Consolidators continued to be the dominant acquirer category, accounting for 41% of announced transactions year to date. Five dominated the category: Mercer Advisors, Beacon Pointe Advisors, Captrust, Focus Financial Partners and Wealth Enhancement Group.
Even though the period from April through June was the fourth-strongest quarter on record, a softening occurred, with transaction volume off 26% from the first quarter of 2021, DeVoe said.
DeVoe said the year’s second half is likely to be active, driven by fear of pending tax changes, high valuations that are attracting formerly reluctant sellers to the negotiating table, seasoned acquirers attracting more sellers with strong value propositions, and many realizing that an internal sale is not an option.
Results of a survey that DeVoe said it would soon release show that nearly half of RIA firms reported they had not successfully implemented a succession plan and that 61% of respondents felt their firms were not capable of a smooth transition of leadership to the next generation.
[More: 10 largest RIA deals in the first half of 2021]
'I feel like they have created an addictive gaming culture, which is not healthy for investing.'
Participants who receive professional 401(k) advice see higher returns on average, net, than those who don't.
Eric Leeper of FP Transitions offers fresh perspective on M&A deals, why buyers are getting more discerning, and how would-be sellers can boost their practice value.
'Buying the dip' has been a winning investing strategy for over a decade. Financial advisors weigh in on whether it will continue to work.
Wealth Enhancement is tapping into new markets nationwide as AlphaCore accelerates plans to form one of California's largest RIAs.
Participants who receive professional 401(k) advice see higher returns on average, net, than those who don't.
This wealth management platform finally delivers on the technology promises other firms couldn't - giving advisors a better way to scale and serve
