Wealthspire Advisors, an NFP company and independent investment adviser, has reached a definitive agreement with acquire Private Ocean LLC, a fiduciary wealth management firm with $2.7 billion in assets.
Private Ocean is based in San Rafael, California, with additional offices in San Francisco and Seattle.
News of the deal comes during another record-breaking year for adviser industry merger and acquisition (M&A) activity. In fact, according to research by Echelon, prospective tax code changes likely helped industry M&A set a quarterly record in the third quarter 2021, which saw 78 deals announced. The previous record was 76 deals, set in the first quarter of this year. The third quarter analysis shows large strategic acquirers, many of which are backed by private equity firms, maintained their status as the most active dealmakers in the wealth management and advisory industry.
At this rate, Echelon researchers expect the number of 2021 deals to outpace the total 2020 deal count by a significant margin. They point to strong secular trends such as overall financial services industry consolidation, growing competition and a need for broader succession planning as key drivers of the rapid pace of M&A. Adding fuel to the fire are supportive capital markets, cheap debt and heightened corporate cash balances—as well as the “transitory trend” related to potential changes in tax rates that could be included in the federal budget legislation making its way through Congress.
Regarding the latest deal, Wealthspire CEO Mike LaMena says the acquisition represents “a significant opportunity to plant a flag on the West Coast and demonstrate our growing national scope.”
The transaction comes on the heels of Wealthspire’s recent agreement to acquire Private Capital Group out of West Hartford, Connecticut. After both transactions are complete, Wealthspire expects to be overseeing assets of approximately $17 billion and to have 18 offices across the country.
Founded in 2009, Private Ocean is the combination of two privately held wealth management firms in the San Francisco Bay area—Salient Wealth Management and Friedman & Associates. The firm also acquired Lakeview Financial in Seattle and Mosaic Financial Partners in San Francisco.
Greg Friedman, CEO and founder of Private Ocean, says his team is “honored to join Wealthspire and embrace the opportunity to continue to serve our clients supported by deeper and broader resources.”
“This is an important step for both of our firms in an environment where scale and quality matter,” he adds.
The transaction is expected to close in the fourth quarter of 2021, subject to customary approvals and closing conditions. The Asset and Wealth Management Investment Banking Group of Raymond James served as financial adviser and Wilmer Cutler Pickering Hale and Dorr LLP served as legal counsel to Private Ocean.