A deal announced yesterday is another example of the vigorous M&A activity that has been a feature of the North American wealth management sector.
Private credit specialist Crestline Investors has made a
strategic investment in Indiana-headquartered Credent
Wealth Management, a $2.6 billion RIA.
The move continues a trend of investment houses buying stakes in
RIAs and other wealth firms, seeking to tap into the
multi-billion wealth transfer to NextGen individuals as well as
exploit a desire for scale and efficiency in the sector.
The deal will help Credent’s M&A expansion strategy, already
under way, a statement from Credent said yesterday. Specifically,
Credent’s Advisor Solutions platform, a turnkey asset management
program (TAMP), uses Credent’s shared services platform to
support independent advisors.
Since launching in 2018, Credent Wealth Management has made more
than 12 acquisitions alongside its organic growth path.
“We believe Credent is well-positioned to continue to execute its
growth strategy in an attractive, consolidating industry with its
client-first approach and differentiated investment platform
solutions to advisors,” Albert Hicks, vice president at
Crestline, said.
Family Wealth Report’s US correspondent, Charles
Paikert,
has commented on which wealth managers and other firms
have notched up the most deals and changes during the first half
of this year. The wealth management M&A and corporate finance
space remains a busy area.
Separately, Los Angeles-based ECHELON Partners,
which acted as investment banker to Credent in the deal, has
issued a report on M&A activity in the industry. It found
that the second quarter of 2024 was the second-highest Q2 period
for M&A on record. There were 75 transactions in the quarter,
rising 15.4 per cent on a year before. The annualized deal total
for the first half of 2024 suggests that the industry is on pace
to exceed 332 transactions for the year, a 3.4 per cent increase
compared with 2023.
Katz Teller served as Credent’s legal counsel in the deal. Alston
& Bird served as legal counsel to Crestline.
Crestline Investors, founded in 1997, is based in Fort Worth,
Texas, with affiliate offices in London, New York City, Toronto
and Tokyo. The firm has about $18 billion in assets under
management (as of December 31, 2023).
Strategic acquisitions
ECHELON’s report said that strategic acquirers and financial
acquirers announced 84 per cent and 16 per cent of the
quarter”s total deals, respectively.
Major RIA deal announcements included the merger of Focus
Financials’ partner firms Buckingham Wealth and The Colony Group,
that formed a $115 billion platform, and Cerity’s acquisition of
Agility, a $15 billion Denver-based outsourced chief investment
office. Notable deals by financial acquirers featured Advent’s
and the Abu Dhabi Investment Authority’s minority investment in
Fisher Investments, along with GTCR’s deal to take AssetMark, a
$117 billon business, into private ownership.
The wealthtech segment continued to be a busy area, ECHELON
added, noting that there were 33 deals announced in Q2 2024.
Of these deals, 75.8 per cent involved targets providing software
as a service to wealth management firms.
