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Focus Financial Strikes 6 Merger Deals for Partners

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Focus Financial said Friday that its partner firms closed six deals in as many months, adding $1 billion in assets under management. It also helped a partner firm add an advisor after the group had initially struck a succession agreement with the individual rep.  

In addition, the partnership has helped its member firms boost total AUM by roughly $2 billion so far this year via mergers.

“2014 has been a terrific year for Focus with tremendous activity across all of our business models,” said says founder and CEO Rudy Adolf, in a statement. “Mergers are an integral part of our value-added programs to our partners, providing them with access to Focus’ M&A expertise and capital. Mergers are also a terrific opportunity to provide succession planning and continuity to many advisors in our industry.”

The independent wealth management firms striking deals with support from Focus Financial over the past six months include the Colony Group, IFM Capital Advisors, GW & Wade, HoyleCohen, Beirne Wealth Consulting and Buckingham Asset Management, adding over $1 billion in client assets across the firms.

Focus Financial says it has completed over 60 mergers for its partner firms since its inception in 2006. In the first half of 2014, Focus facilitated mergers for Atlas Private Wealth Management, Bridgewater Wealth & Financial Management, LVW Advisors, Sapient Private Wealth Management and Telemus Capital Partners. 

“We now have 31 partners firms and affiliates,” said Rajini Kodialam, managing director and co-founder of Focus Financial, in an interview with ThinkAdvisor.

The five partner firms that have joined it so far in 2014 are Gratus Capital Management of Atlanta; Flynn Family Office of New York; Summit Financial Wealth Advisors of Lafayette, Louisiana; Quadrant Private Wealth of Bethlehem, Pennsylvania; and IFM Capital Advisors of Denver.

Partner firms and affiliates now have more than $80 billion of client assets and produce roughly $325 million in yearly revenue, Kodialam says.

“It’s been a very good year,” she explained, “with lots of pure organic growth at our partner firms, which are the best in class in the country. Mergers also are very important, and we help our partners and affiliates … with legal support and capital to execute them.”

Details on Deals

GW & Wade, a Wellesley, Massachusetts-based partner firm with $4.8 billion in client assets, recently added advisor Paul St. Onge, an East Greenwich, Rhode Island-based sole practitioner with $150 million in client assets. Onge entered into a Focus Successions agreement with GW & Wade to “ensure continuity of service to his clients beyond his eventual retirement, but shortly after decided to accelerate the process by merging with GW & Wade,” according to Focus Financial.

“This is the first example we’ve had of signing a succession deal with an advisor who then decided to merge with a partner or affiliate,” Kodialam said. “We believe this is a trend we will see a lot more of.”

The Boston-based Colony Group, an RIA with about $3.7 billion in client assets, merged with Long Wharf Investors of Boston in July.

“Long Wharf Investors has built a firm that is fully dedicated to providing clients with a first-class wealth management experience and the investment strategies to match,” said Michael Nathanson, CEO of the Colony Group, in a press release.

IFM Capital Advisors, which was formed in January by a pair of ex-UBS advisors, recently expanded its business by adding Don Graubert, founder of Post Oak Capital Advisors, a Houston-based RIA.  In the past 10 months, it has grown its assets to $1.3 billion from $800 million.

“Don’s impressive career in the financial services industry is a testimony to how financial advisors can serve their clients,” said Tim Kneen, co-founder and chief investment officer of IFM Capital, in a statement. 

HoyleCohen, a San Diego-based RIA, which first partnered with Focus in 2006, added industry veteran Chuck Ebersole to its team in August. Ebersole, who works out of an office in Sacramento, California, has some $140 million in client assets and helped bring HoyleCohen’s total client assets to the $750 million mark.

Beirne Wealth Consulting of Milford, Connecticut, says it added advisor Lise Robinson, formerly of Oppenheimer & Co. Inc. Robinson joined the team in September.

“We are excited to have Lise join our team as she brings a wealth of experience to the table.  Lise wanted to be at a firm that embraced open architecture and a fiduciary model.  We are very fortunate to have her,” said Jim Betzig, partner and COO of Beirne Wealth, in a statement.

Lastly, Buckingham Asset Management, a St. Louis-based Focus partner firm, added Hufford Financial, an Indianapolis-based firm with some $400 million in client assets, to its practice through an intra-Focus merger in October. Together with BAM Advisor Services, Buckingham is managing or administering more than $24 billion in client assets. 

Wirehouse Expansion

Focus Financial expects interest from wirehouse reps in joining its partners and affiliates to continue.

“We work with wirehouse advisors whose business really looks like that of RIAs and who want to work on becoming truly independent as an RIA,” said Kodialam. “And we work with wirehouse advisors who want to become part of an existing RIA.”

Several months ago, Focus Financial announced that former Merrill Lynch Global Wealth Management President Dan Sontag had joined the board of directors. (Sontag joined Merrill Lynch in 1978 and retired from the brokerage firm in August 2009.)

With Sontag, Focus Financial has seven board members, six of whom are independent. In June, Focus tapped another Merrill Lynch veteran, Chris Dupuy, to be co-president of Focus Connections. Like Sontag, he worked at Mother Merrill for roughly 30 years.

— Check out The Succession Planning Mirage, and the Alternative on ThinkAdvisor.


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