From the May 2014 issue of Research Magazine • Subscribe!

Sterne to Buy WRP; Baird to Merge with MWR

Sterne Agee Financial Services says it will buy WRP Investments, which has some 350 independent advisors. “We quickly recognized the unique culture of WRP and the mutual benefits a partnership could create for both firms,” said Jay Carter, CEO of Sterne Agee Financial Services of Birmingham, Ala., in a press release.

Youngstown, Ohio-based Sterne Agee “has maintained a tradition and culture of excellence for over 100 years, and it was exciting to find another firm that shares our values,” Carter added. “This was one of those special opportunities where all parties are better served and better positioned for the future.”

Sterne Agee, founded in 1901, employs over 1,600 financial professionals in 20 states and has about $23 billion in client assets under management. WRP, started in 1976, had $45.5 million in broker-dealer revenue in 2012, according to the “Investment Advisor” 2013 Broker-Dealer Reference Guide. The average fees & commissions per rep was $137,000.

Average assets per advisor at WRP in 2012 were $1.7 million, giving it total assets of nearly $600 million. Its level of fee-based assets was roughly $400 million.

“This is all about the future,” said David Pintaric, CEO of WRP Investments, in a statement. “Combining forces with them allows us to offer state-of-the-art technology and industry-leading services to the people we serve, while allowing WRP to remain WRP.”

In December, privately held Sterne Agee wrapped up its purchase of London-based brokerage firm Yorvik Partners, its first overseas deal. “This is undoubtedly an exciting step toward not only expanding but also enhancing our full-service offerings,” Yorvik Partners founder and CEO Simon Mullaly said at the time.

Baird News

Milwaukee-based Baird has announced plans to merge with Seattle-based McAdams Wright Ragen. The deal means Baird could add up to 85 financial advisors, bringing its rep count to 810. Both firms are employee-owned. Baird has more than $100 billion in client assets, while MWR has more than $10 billion. Terms of the deal were not made public.

“Taking this important step enables MWR to enhance the services and capabilities it offers its clients, and positions Baird to expand our current footprint in the Pacific Northwest,” said Baird Chairman and CEO Paul Purcell, in a press release. “We couldn't be more pleased to welcome MWR to the Baird family.”

Since early 2009, Baird says it has added more than 325 financial advisors and branch managers, the vast majority of whom are industry veterans, to its ranks. Recently, Baird said it recruited a branch manager in Charleston, S.C., from Wells Fargo. The company also posted its 2013 financial results and noted that it recruited 44 veteran advisors and branch managers last year.

The firm's overall revenues were $1.1 billion in 2013 vs. $961 million in 2012. Operating income totaled $117 million, up 17% from a year ago, and the firm's 2013 return on equity rose to more than 15%. Client assets grew to more than $117 billion by year-end.

“Baird's independent, employee-owned model and its deep expertise and capabilities, along with its commitment to being a great place to work and putting clients’ needs above all else, make our decision to join forces the best next step for our business and our clients,” said MWR President and CEO Scott W. McAdams, in a statement.

MWR opened its doors with eight people in 1999, opening branches in Mount Vernon, Wash., in late 2010 and Anacortes, Wash., in January 2011. In May 2012, MWR opened its seventh office in Spokane, Wash. In 2013, it had revenues of $48 million.

“McAdams Wright Ragen and Baird are remarkably similar in very important ways,” said MWR Chairman Brooks Ragen, in a press release. “With our reputation and capital on the line every day, we manage conservatively and are extraordinarily focused on how well we perform for our clients and on how we best serve them. Both organizations also have very strong traditions of giving back to our communities in a significant way.”

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