Numerous changes were announced Thursday as part of RCS Capital’s (RCAP) sale of its troubled wholesale distribution unit to Apollo Global Management (APO) for $25 million and the two firms’ plans to form AR Global Investments, which will be owned 60% by Apollo and 40% by RCAP.
“Bill Dwyer, the chief executive officer of RCS’ wholesale business, will continue to lead the business following the acquisition,” according to a statement put out by Apollo late Thursday.
On Thursday, RCS Capital reported a 65% year-over-year drop in its second-quarter equity sales to $1.3 billion.
Dwyer is the former head of LPL Financial’s advisory operations, a post he retired from in 2013, after about 20 years with the independent broker-dealer. He became CEO of Realty Capital Securities’ wholesale distribution unit in September 2014.
In October, American Realty Capital Properties (now VEREIT) reported $23 million of accounting errors, and at the time, the co-founder of ARCP, AR Capital and RCAP — Nicholas Schorsch — was executive chairman of both ARCP and RCAP. This news, in part, prompted RCAP to renege on its planned purchase of ARCP’s Cole Capital business for $700 million, and ARCP then moved to sue its investment partner. Many broker-dealers temporarily suspended sales of AR Capital-sponsored nontraded REITs.
AR Global will own a majority of the asset management business of AR Capital, which sells REITs and other alternative products. It also is forming a strategic relationship with RCS Capital’s advisory business, Cetera Financial Group, which is led by Larry Roth and includes some 9,000 independent advisors.