Wealth Enhancement agrees to purchase $22B RWA Wealth Partners
Michelle Knight, CEO and chief economist at RWA Wealth Partners.
The Boston deal is about to push the PE-backed consolidator previous $187 billion amid a broad RIA M&A slowdown and a possible shift in its possession.
In what’s certain to be one of many largest RIA offers of the yr, Wealth Enhancement has agreed to accumulate RWA Wealth Partners, a Boston registered funding advisor with roughly $22.46 billion in consumer belongings.
The deal, which dwarfs the extra modest tuck-ins that is pushed the Minneapolis agency’s fast progress, arrives after experiences that its personal non-public fairness house owners have been procuring the enterprise.
The acquisition unveiled Wednesday would carry Wealth Enhancement to greater than $187.1 billion in consumer advisory, belief and brokerage belongings. That complete consists of $8.5 billion held with Advisory Solutions Group, an affiliated RIA.
Wealth Enhancement reported $164.6 billion in consumer belongings as of Aug. 31. The RWA deal is anticipated to shut within the fourth quarter whereas marking an exit for Summit Partners, RWA’s non-public fairness backer.
RWA is led by Michelle Knight, its chief govt and chief economist. With a robust standing as one of many largest woman-led RIAs within the nation, RWA was formed in 2023 when Adviser Investments mixed with Ropes Wealth Advisors, beforehand an entirely owned subsidiary of regulation agency Ropes & Gray. Besides its Boston headquarters, RWA has places of work in Newton, Mass.; San Francisco and Costa Mesa, Calif.; Chicago; and Traverse City, Mich.
Why Wealth Enhancement needs a household workplace
The most important attraction is RWA Family Office. It will turn into a part of Reserve by Wealth Enhancement, the acquirer’s service line for households that typically maintain $25 million or extra in investable belongings. RWA’s belief and property experience comes from its Ropes & Gray lineage. Its household workplace workforce handles belief administration, skilled trustee providers, property settlement, and private and fiduciary tax work.
For ultra-high-net-worth households, these providers have typically been cut up amongst advisors, attorneys and accountants. With the RWA deal, Wealth Enhancement is becoming a member of a wave of different giant gamers betting that the wealthiest purchasers pays for a single workforce that coordinates all of them.
“One of the core founding rules of Wealth Enhancement was to supply complicated monetary planning to high-net-worth and ultra-high-net-worth purchasers. RWA’s capabilities will strengthen how we meet these wants,” mentioned Jeff Dekko, Wealth Enhancement’s chief govt. “Its established household workplace capabilities add depth to how we serve ultra-high-net-worth purchasers with deep specialization in trusts and estates, tax-aware planning, and the seamless coordination required to show recommendation into motion.”
After closing, RWA Family Office will nonetheless be led by Knight, JP Powers, Nicole LaChapelle and Kristin Fazio. RWA’s Private Wealth enterprise, which serves high-net-worth purchasers, will function as advisor groups inside Wealth Enhancement, with Steve Reder persevering with to work with these groups.
“Wealth Enhancement shares our perception that complete wealth administration begins with a deep understanding of every consumer and the life they’re working to construct throughout generations,” Knight mentioned. “This human facet of wealth has at all times been central to how we serve households, as a result of behind each monetary determination is a set of objectives, values, and aspirations.”
A serial acquirer that’s itself on the market
Wealth Enhancement has grown largely by way of a gentle stream of smaller offers. At the tip of August it closed on Arbor Capital Management, a $345 million RIA based in Anchorage, Alaska, which took the agency into its forty first state.
For the second quarter alone, Echelon Partners’ second-quarter RIA M&A deal report credited Wealth Enhancement with seven transactions; solely Stratos Wealth Network, with 11, did extra.
The current burst of acquisitions can also be taking place at an fascinating time for Wealth Enhancement, which is reportedly being scouted by new potential PE house owners. As a report by the Financial Times had it, Carlyle Group and Bain Capital were competing as the final bidders for the agency, which on the time held a valuation of about $7 billion together with debt.
Assuming it does occur, the acquisition of Wealth Enhancement could be among the many largest on document for a single RIA, rivaling Mubadala Capital’s 2024 deal for CI Financial in 2024.
