RIAs on Pace for Record-High Mergers & Acquisition Activity in 2019, TD Ameritrade Institutional’s FA Insight Finds
July 18 2019 - 7:00AM
Business Wire
Deal Volume in First Half is Up 82 Percent from
Year-Ago Period, While M&A Activity Increased in Each of the
Past Four Quarters
Just how hot is mergers & acquisitions
activity among registered investment advisors? Just six months into
the year, 2019 already ranks as one of the five most active years
on record for registered investment advisor (RIA) deals, according
to the FA Insight Mergers & Acquisitions 2019 Mid-Year Update
from TD Ameritrade Institutional.1
Advisory firms announced 69 mergers and acquisitions in the
first six months of 2019, up 82 percent from the same time period
in 2018, making this the most active six months since FA Insight
commenced tracking advisory firm M&A activity in 2000. These
deals represent a total of $57 billion in motion during the first
half of 2019, up 39 percent from the same period last year, with a
median $413 million in assets under management (AUM) in motion.
The pace of deal announcements picked up considerably over the
past year and has posted consecutive gains in each of the past four
quarters, according to the report. After advisory firms announced a
record high of 33 deal announcements in the quarter ended March 31,
they reached an all-time high of 36 in the quarter ended June 30.
Independent RIAs led the way, initiating three-fourths of all
advisory firm deals in the first half.
The urge to merge may be spreading. In the half, 48 different
firms announced a transaction, nearly as many as the 54 firms that
initiated deals in all of 2018.
Though the number of one-off deals by RIAs climbed in the period
to represent nearly 40 percent of transactions, RIA firms that
engage in multiple acquisitions continue to make their presence
felt with an increase in the total share of deals among them to 36
percent. Mercer Global Advisors alone announced four acquisitions
during the first half, while Wealth Enhancement Group’s partner
firms announced three.
Focus Financial Partners (Nasdaq: FOCS) and its partner firms
initiated 16 deals, representing 23 percent of first-half
activity.
“The forces driving the accelerating pace of industry
consolidation in recent years are now intensifying,” said Pete
Dorsey, Managing Director of Sales at TD Ameritrade Institutional.
“More than ever, independent advisors are leveraging acquisitions
to fuel growth, pursue long-term strategic goals, and, in some
cases, build national enterprises. RIA deal activity has also
benefitted from low borrowing costs and the rising number of firms
willing to sell as valuations rise.”
Barring a downturn in the economic climate or securities
markets, the industry is on pace to reach new highs in M&A,
according to the report.
Click here to download a copy of the FA Insight Mergers &
Acquisitions 2019 Mid-Year Update.
Methodology
The FA Insight M&A database tracks U.S.-based RIAs or
independent trust companies that have been acquired or merged into
another firm. The “target” firms sold or merged into another must
directly serve households or individual clients and they must
manage at least $50 million in AUM or generate at least $500,000 in
annual revenue. Transactions also must involve an exchange of
equity with an outside party representing a 10% or more of the
target firm’s value.
The database excludes firms with more than $20 billion in AUM,
transactions targeting independent broker-dealers, internal
transitions of ownership, as well as individuals or teams joining a
firm.
About TD Ameritrade Holding Corporation
TD Ameritrade provides investing services and education to more
than 11 million client accounts totaling approximately $1.3
trillion in assets, and custodial services to more than 7,000
registered investment advisors. We are a leader in U.S. retail
trading, executing an average of approximately 850,000 trades per
day for our clients, more than a quarter of which come from mobile
devices. We have a proud history of innovation, dating back to our
start in 1975, and today our team of 10,000-strong is committed to
carrying it forward. Together, we are leveraging the latest in
cutting edge technologies and one-on-one client care to transform
lives, and investing, for the better. Learn more by visiting TD
Ameritrade’s newsroom at www.amtd.com, or read our stories at Fresh
Accounts.
About TD Ameritrade Institutional
TD Ameritrade Institutional empowers more than 7,000 independent
registered investment advisors to transform the lives of their
clients. It provides powerful technology and resources that help
simplify running a business and let advisors spend more time doing
what matters most — serving their clients. Through meaningful
innovation, steadfast advocacy and unwavering service, TD
Ameritrade Institutional supports RIAs as they build businesses
that positively impact their clients and communities.
Brokerage services provided by TD Ameritrade, Inc., member FINRA
(www.FINRA.org) / SIPC (www.SIPC.org).
1 TD Ameritrade Institutional is a division of TD Ameritrade,
Inc., a brokerage subsidiary of TD Ameritrade Holding Corporation.
FA Insight is a product of TD Ameritrade Institutional and a
trademark owned by TD Ameritrade IP Company, Inc..
Source: TD Ameritrade Holding Corporation
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190718005077/en/
Joseph Giannone Communications & Public Affairs W: (201)
369-8705 Joseph.Giannone@tdameritrade.com
TD Ameritrade (NASDAQ:AMTD)
Historical Stock Chart
From Mar 2024 to Apr 2024
TD Ameritrade (NASDAQ:AMTD)
Historical Stock Chart
From Apr 2023 to Apr 2024