Wealth M&A Slows, but Strategic Deals Continue to Be Inked

Alera Group, a national insurance and wealth services firm, is among the latest established entities to begin picking up smaller independent wealth management shops in key markets.

This week, Alera Group, an independent national insurance and wealth services firm, announced its acquisition of DFG 401(k) Advisors, an independent qualified retirement plan services company.

DFG is led by Jeff Anderson, president and managing partner. In a press release announcing the deal, he says the firm brings to the table more than 30 years of experiencing collaborating with “conscientious companies” in the effort to scrutinize and benchmark their 401(k) plans.

“The goal is to improve benefits, save money, streamline administration and ensure compliance amid the confusion of changing legislation and regulations,” he adds. “We are a dedicated team of industry professionals, protecting fiduciaries from corporate and personal financial liability and enhancing potential return-on-plan investment opportunities.”

Based in Phoenix, Arizona, DFG 401(k) Advisors, provides a variety of services in fiduciary guidance, plan performance and employee financial wellness. Alan Levitz, CEO of Alera Group, says in the release that DFG 401(k) Advisors is dedicated to helping clients execute the best strategies in order to achieve their desired level of financial security.

“The team is aligned with Alera Group as it endeavors to exceed client expectations, as they provide quality retirement solutions,” Levitz says. “We look forward to welcoming this team to Alera Group and expanding our footprint in Arizona.”

DFG 401(k) Advisors joins Alera Group under the name BCG 401(k) Advisors through Benefit Commerce Group (BCG), an Alera Group company headquartered in Scottsdale. The BCG 401(k) Advisors team will continue serving clients in their existing roles. Terms of the transaction were not announced.

Wise Rhino Group served as exclusive adviser to DFG 401(k) Advisors.

Peter Campagna, partner at Wise Rhino Group, says in a separate statement that DFG’s partnering with a firm like Alera will help them bring their client service to even higher levels.

“These two firms working together have a very bright future,” Campagna says.

As Campagna observes, the acquisition represents a push into the wealth and retirement area by Alera Group, following on the heels of its June acquisition of Wharton Group. Similar to other strategic acquirers, Alera’s M&A strategy is about bringing retirement plan consulting and wealth management capabilities together with a large healthcare benefits footprints—all under the Alera Group brand.

News of Alera’s acquisition comes after total wealth management M&A activity decreased for the second straight quarter of 2022, after reaching an all-time high in the final quarter of 2021. This is according to Echelon Partner’s latest RIA M&A Deal Report.

Specifically, Echelon finds quarterly deal volume declined again in the second quarter, but it still remains elevated from a historical perspective. Industry-wide, there were 87 deals announced in the second quarter. While a decrease from the most recent periods, the transaction volume level still makes it the third most active quarter since Echelon began tracking the data.

As Echelon points out, strategic acquirers and consolidators continued to execute on their M&A pipelines despite the more volatile markets. This level of commitment from experienced acquirers means that deal structures and valuations have remained relatively attractive for sellers, the report concludes.