Average Size of Advisor M&A Deal Jumps in Q2: Schwab

According to Schwab, the 12 M&A deals in the second quarter of 2011 represented $13.2 billion in AUM and represented a decrease in deals from the 14 deals with approximately $8 billion in AUM reported in the same quarter in 2010. The 12 deals tracked by Schwab in Q2 of this year had an average deal size of $1.1 billion, versus $571 million in Q2 of 2010. The dominant buyer category continues to be RIAs, Schwab says, which conducted 12 transactions in 2011.

“RIAs continue to be the dominant buyer category, demonstrating their growing sophistication in mergers and acquisitions,” said DeVoe. “It also shows RIAs’ willingness to use M&A as one way to achieve business goals and objectives.”

In Q2 2011, Schwab issued M&A data based on an updated methodology that provides a tighter focus on RIAs who directly serve the high net worth client segment and removes institutional RIAs.

Going forward, Schwab’s M&A data will focus on:

• Firms that predominantly serve high net worth retail investors;
• Firms with at least $50 million in AUM;
• Breakaway brokers from wirehouses who received consideration for joining an RIA.