Growing Chicago-based Cresset Asset Management increases its assets under management by more than 30% with the acquisition of Atlanta-based Berman Capital Advisors, a $ 4.7 billion company founded in 2010.
The deal, which is described as a merger with a “substantial equity component”, will bring Cresset’s assets under management to around $ 20 billion when closed over the next week.
Cresset was founded in 2017 by Eric Becker and Avy Stein.
In the merging frenzy that has enveloped the wealth management space for several years, it is unique in that it is a multibillion dollar deal that does not involve a listed RIA. on the stock market or any trace of private equity financing.
“We are absolutely not backed by private capital,” Becker said. “It’s a company that was built by clients for clients, and it is very intentionally designed around employee ownership with a 100-year vision.”
In June 2020, Cresset acquired PagnatoKarp, based in Reston, Va., An RIA of $ 2.3 billion, but Becker said the growth of the company was mostly organic and the plan was not to become a serial acquirer.
“I wouldn’t say we’re on an acquisition program, but we’re still interested in culturally compatible organizations,” he said.
David DeVoe, Managing Director of DeVoe & Co., put the scale of RIA’s consolidation into context, explaining that more than half of the salespeople in the current quarter managed more than $ 1 billion, this which he says is about 30% above the historical average.
“It’s a powerful combination; strengthen Cresset’s position as a premier, ultra-high net worth wealth manager, ”said DeVoe. “Cresset has been a unique story, growing from an idea to over $ 20 billion in just four years.”
Daniel Seivert, CEO of Echelon Partners, described the acquisition of Cresset as “powerful”.
“They have a very specific target profile and a great discipline to only do transactions that match in terms of average client size and practice size that is heading towards the broad end of the spectrum,” he said. he declares. “There aren’t a lot of businesses for sale that fit that criteria and there are a lot of other buyers who have a rig in that size range or are looking to get one. Suddenly, competition is fierce for this type of quality family office target.
The 33 members of the Berman team join Cresset Asset Management.
“Cresset is the partner we were looking for to take our business to the next level, offer our clients an even wider range of services and provide career development opportunities and increased ownership for our team,” said Justin Berman, founder and managing director. by Berman Capital Advisors. “We are delighted to share with our existing and new clients the truly holistic range of innovative wealth management, family office and private investment offerings that we can offer together,” he added.
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