Deals & People June 1, 2023

CAPTRUST Acquires Omega Wealth Partners

Omega, based in Fort Worth, is CAPTRUST’s second deal in Texas this year. 

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CAPTRUST Financial Advisors is continuing its run of acquiring wealth managers with a Thursday announcement of the purchase of Omega Wealth Partners, which oversees more than $710 million in assets for high-net-worth individuals and families. 

The addition of Omega is CAPTRUST’s fourth acquisition of 2023 and the 67th since 2006, according to the firm. As with other deals, Omega will take on the CAPTRUST brand. 

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“The wide array of resources we gain by joining CAPTRUST will give us an edge as we continue to provide a top-notch client experience,” Tom Hardgrove, Omega’s co-owner and managing partner, said in a statement. “We knew right away that becoming a part of CAPTRUST was a good decision—at our core, we both prioritize the relationship with each client.”  

Hardgrove, alongside co-owners John Dickens and Tammy Bryant, will join CAPTRUST with six additional colleagues.  

“With a long history as a family-owned business in Fort Worth, CAPTRUST’s collaborative nature and colleagues’ genuine support for each other’s successes was one of the many reasons we knew they were the right fit,” said Dickens in a statement. “We look forward to enhancing the customized and unbiased service we currently deliver to our clients by utilizing CAPTRUST’s extensive marketing, investment, and research options.”   

Omega, based in Fort Worth, is CAPTRUST’s second deal in Texas this year. For more than a decade, CAPTRUST has sought to expand throughout the state. Recent additions of firms based in Texas include Monroe Vos, Covenant and South Texas Money Management. CAPTRUST now has a presence in seven Texas cities, totaling 120 employees.  

“We are excited to enter a new market in Fort Worth with Omega,” said Rush Benton, CAPTRUST’s senior director of strategic growth, in a statement. “As former professional athletes, Tom and John understand the collaborative nature that is crucial to CAPTRUST’s success. We are looking forward to bringing Omega’s expertise to the firm.” 

Omega’s financial adviser in the transaction was Park Sutton Advisors, a Waller Helms Company, according to the announcement.

In Practice May 31, 2023

House Passes Small Entity Update Act to Evaluate Size Cutoff for Advisories

The bill would require the SEC to study and update its definition of ‘small entity,’ which could significantly impact independent financial advisers.

 

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The Small Entity Update Act passed the House of Representatives Tuesday by a vote of 367 to 8, moving a proposal to the Senate that could reduce regulatory burdens on some independent financial advisers. The act had passed the House Financial Services Committee unanimously in April.

The bill, initially proposed by Representative Ann Wagner, R-Missouri, would require the Securities and Exchange Commission to study and update its definition of “small entity” within one year of the bill’s passage and every five years thereafter. In its study, the SEC would have to account for the growth of the financial services industry and ensure that any definition captures “a meaningful number of entities.”

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Currently, when considering compliance with multiple securities laws, the SEC defines investment advisers with less than $25 million in assets under management as small entities not required to register with the SEC.

Wagner noted in a markup hearing on the bill that it is intended to reduce regulatory burdens on small businesses and advisers affected by SEC regulations. The bill does not provide a new definition of “small entity” but requires the SEC to study changes to the definition and report its findings to Congress.

During the same markup hearing, Representative Sean Casten, D-Illinois, recommended adding a provision that would tie the definition to inflation. Wagner described the suggestion at the time as a “common sense addition” and that it should factor into the SEC’s study and report. No language requiring a peg to inflation is in the bill as passed.

Currently, advisers with less than $25 million in assets under management are prohibited from registering with the SEC, and those with $110 million or more are required to do so.

Karen Barr, the president and CEO of the Investment Adviser Association, said in an emailed statement that, “The IAA is delighted the House of Representatives has passed the Small Entity Update Act, which requires the SEC to update its small business definition. Due to an outdated definition, the SEC has not been required to explicitly consider reasonable alternatives to proposed regulations for smaller investment advisers. The IAA strongly supported this bill and urges the Senate to take it up promptly.”

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