Assets Under Management AUM

RIA Roundup: Ben Edwards hires Baird team for fledgling RIA unit, CI signs deal for $ 5.2 billion company

September 17, 2021

St. Louis-based regional brokerage firm Benjamin F. Edwards has attracted a team of two advisers in Lexington, Ky. From regional competitor Baird to its new registered investment advisor channel.

The team, led by 23-year industry veteran Larry W. Crosthwaite, is the fourth practice to join Edwards Wealth Management since its inception in 2019, according to Chris Keller, head of RIA business.

The company’s RIA channel, like others launched in the run-up to the Covid-19 shutdown, has encountered a hiring hurdle in 2020, but executives are optimistic about its growth prospects, Keller said. (Wells Fargo Advisors’ RIA Guard Channel, introduced the same year, recently saw a pickup in recruitment after a pandemic-induced slowdown, executives said.)

“Things got a little tougher for a while, but we got our legs back under us,” Keller said.

Crosthwaite, who named his firm Elkhorn Private Wealth, was joined on September 9 by advisor Kyle C. Steele and two other Milwaukee area employees Robert W. Baird & Co. The team managed $ 140 million in ‘active clients, according to Ben Edwards, and maintain their brokerage licenses through the Ben Edwards broker.

Ben Edwards’ employee advisory business and RIA business manages approximately $ 37 billion in total client assets with more than 600 employees, according to the company’s announcement of the addition of Elkhorn. The consulting business will represent around $ 600 million in assets and around a dozen employees if Elkhorn moves all of his team’s assets, Keller said.

“We don’t see these chains as having to compete with each other,” Keller said. “Where our pipeline is, we’re seeing enough interest where we’re very optimistic about growth on the employee side and the ownership side of the business. “

Keller said teams joining the RIA channel retain full ownership of their practice while Ben Edwards takes a percentage of the revenue in exchange for access to his compliance and operational resources. Edwards Wealth Management subsidiaries list their assets on the company’s Form ADV filed with the Securities and Exchange Commission rather than keeping theirs.

Crosthwaite, who started his career in 1998 at AG Edwards & Sons, joined Citigroup Global Markets in 2002 and Baird JJB Hilliard’s predecessor, WL Lyons in 2009, according to BrokerCheck. He had been registered with Baird since 2019, when his acquisition of Hilliard closed. Steele had spent his entire 4-year career with Hillard and Baird, according to the database.

Keller said much of Ben Edwards, founded in 2008, was created by AG Edwards advisers, given ties to CEO Tad Edwards, whose father was the last family member to oversee the former company, acquired in 2007 by Wells Fargo’s predecessor, Wachovia Securities.

CI FINANCIAL AGREEMENT FOR SILICON VALLEY RIA

The latest acquisition by Toronto-based asset manager CI Financial during its shopping spree in the United States is Portola Partners, a Menlo Park, Calif., Based RIA that manages approximately $ 5.2 billion in assets.

Financial terms of the deal were not disclosed, but CI made a mix of minority, majority and 100% acquisitions for its RIAs. The acquisition would be the Canadian firm’s 21st, including sub-acquisitions from existing partners, as it began to engulf US RIAs in late 2019.

Portola has a roster of high net worth clients, including founders, executives and venture capitalists of tech companies in the San Francisco Bay Area, according to a CI announcement Tuesday.

The RIA was only founded last year by Steve Rehmus, Zack Herlick, Justin Mandly, KC Corkery, Cathy Pitts, Jeff Lin and Susan Foster, all of whom previously worked for Chicago-based RIA Brownson, Rehmus & Foxworth. .

Now a company of around 30 people, Portola was drawn to CI in part because of its “exceptionally attractive long-term growth opportunity for our future generations of advisors and leaders,” Rehmus said in a prepared statement. .

CI’s total US wealth management assets under management are expected to reach approximately $ 82 billion upon closing of the Portola deal and other pending transactions.

In addition, CI announced Wednesday the opening of a US headquarters in Miami.

FOCUS ADDS AUM DOLLAR 1.1 BILLION RIA IN THE UNITED STATES AND CANADA

Focus Financial Partners adds to its partner network two RIA entities collectively known as Cardinal Point, managing approximately $ 1.1 billion in client assets in the United States and Canada.

New York RIA’s backer deal for Toronto-based Cardinal Point Capital Management and Irvine, Calif.-Based Cardinal Point Wealth Management is expected to close in Q4 2021, according to a Focus announcement Thursday. .

Cardinal Point’s U.S. entity has around AUM $ 648 million while its Canadian entity has around AUM (US) 481 million, according to their Form ADV updates filed in September.

Jeff Sheldon, founder and CEO of Cardinal Point, said in a prepared statement that the deal would position his business for “continued growth” while ensuring a succession plan.

Focus CEO Rudy Adolf introduced Cardinal Point as a “leader in cross-border wealth management, adding unique expertise to our partnership”. He also said the deal ticked the box in terms of expanding Focus’s international footprint – “an important strategic priority”.

Earlier this month, Focus added a Cleveland-based company whose RIA and brokerage subsidiaries together managed approximately $ 9 billion in client assets, further strengthening its presence in the Midwest.

A publicly traded company with the backing of private equity firm Stone Point Capital, Focus typically buys all of the assets and a percentage of the RIA’s cash flow in partner company transactions, rather than buying the companies directly.

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