Why the Orion-Brinker Merger Is a Big Deal

Financial services is the hot space for mergers and acquisitions — with news breaking over the weekend that Orion Advisor Services is merging with Brinker Capital and then on Monday that Empower Retirement is buying robo-advisor Personal Capital.

Orion and Brinker should have a combined $40 billion in assets under management and some 6,000 advisor clients, with Orion also working with some $1 trillion in assets under administration on its platform. 

“It’s a brilliant move by CEO Eric Clarke and the Orion team to scoop up one of the few remaining sizable TAMPs left in the industry,” said Tim Welsh of Nexus Strategy in an email to ThinkAdvisor about the market for turnkey asset management programs.

“Consolidation continues to accelerate in the independent wealth space, as size and scale matter ever more in a world of declining basis points,” Welsh explained.

What makes this deal significant, says Technology Tools for Today’s Joel Bruckenstein, is how Brinker “complements what Orion is doing” while also bringing it size and scale.  

For instance, Brinker’s operations include behavioral finance tools, training and resources, as well as insights from Chief Behavioral Officer Daniel Crosby.

“I speak with Orion CEO Eric Clarke from time to time, … and they want to get better in this area,” Bruckenstein explained in an interview with ThinkAdvisor. “Having Crosby as part of the team is a big plus.”

On the investments side of the business, Orion is looking to expand its TAMP business and investment management work, too, “so the expertise of Brinker is strategic,” the tech consultant said. 

The deal also brings economies of scale, Bruckenstein points out. “At $40 billion-plus these days, scale matters,” he noted. “All these reasons make the merger a good fit for Orion.”