A deal announced yesterday is another example of the vigorous M&A activity that has been a feature of the North American wealth management sector.

Private credit specialist Crestline Investors has made a strategic investment in Indiana-headquartered Credent Wealth Management, a $2.6 billion RIA.

The move continues a trend of investment houses buying stakes in RIAs and other wealth firms, seeking to tap into the multi-billion wealth transfer to NextGen individuals as well as exploit a desire for scale and efficiency in the sector. 

The deal will help Credent’s M&A expansion strategy, already under way, a statement from Credent said yesterday. Specifically, Credent’s Advisor Solutions platform, a turnkey asset management program (TAMP), uses Credent’s shared services platform to support independent advisors.

Since launching in 2018, Credent Wealth Management has made more than 12 acquisitions alongside its organic growth path.

“We believe Credent is well-positioned to continue to execute its growth strategy in an attractive, consolidating industry with its client-first approach and differentiated investment platform solutions to advisors,” Albert Hicks, vice president at Crestline, said.

Family Wealth Report’s US correspondent, Charles Paikert, has commented on which wealth managers and other firms have notched up the most deals and changes during the first half of this year. The wealth management M&A and corporate finance space remains a busy area. 

Separately, Los Angeles-based ECHELON Partners, which acted as investment banker to Credent in the deal, has issued a report on M&A activity in the industry. It found that the second quarter of 2024 was the second-highest Q2 period for M&A on record. There were 75 transactions in the quarter, rising 15.4 per cent on a year before. The annualized deal total for the first half of 2024 suggests that the industry is on pace to exceed 332 transactions for the year, a 3.4 per cent increase compared with 2023. 

Katz Teller served as Credent’s legal counsel in the deal. Alston & Bird served as legal counsel to Crestline.

Crestline Investors, founded in 1997, is based in Fort Worth, Texas, with affiliate offices in London, New York City, Toronto and Tokyo. The firm has about $18 billion in assets under management (as of December 31, 2023).

Strategic acquisitions
ECHELON’s report said that strategic acquirers and financial acquirers announced 84 per cent and 16 per cent of the quarter's total deals, respectively. 

Major RIA deal announcements included the merger of Focus Financials’ partner firms Buckingham Wealth and The Colony Group, that formed a $115 billion platform, and Cerity’s acquisition of Agility, a $15 billion Denver-based outsourced chief investment office. Notable deals by financial acquirers featured Advent's and the Abu Dhabi Investment Authority’s minority investment in Fisher Investments, along with GTCR’s deal to take AssetMark, a $117 billon business, into private ownership.

The wealthtech segment continued to be a busy area, ECHELON added, noting that there were 33 deals announced in Q2 2024. Of these deals, 75.8 per cent involved targets providing software as a service to wealth management firms.