After nearly doubling in size in less than three years, a major registered investment advisor has a new private equity backer and a new asset management arm.
San Francisco-based Parallel Advisors purchased Autus Asset Management of Scottsdale, Arizona while receiving a strategic investment from Golden Gate Capital, a private equity firm in San Francisco. The influx of capital bought out Emigrant Bank's Emigrant Partners from its prior minority position in the wealth and asset management firms, the parties
"The opportunity to exit Parallel and Autus in a combined transaction to Golden Gate Capital in a control deal was a great outcome for everyone, including Emigrant," Emigrant CEO Karl Heckenberg said in an email. "We wish Golden Gate well in their entry to wealth management."
Representatives for Parallel and Golden Gate declined to discuss the terms of the deal. Industry news outlet Citywire RIA first
Emigrant and other dealmakers have propelled
Other big deals of note from the past week consisted of New York-based wealth manager Snowden Lane Partners
The newly public firm
In an interview, Alvarium Tiedemann CEO Michael Tiedemann said he and the other parties expected investors' interest in SPACs to wane over time. In their case, he said, they viewed the use of an entity called Cartesian Growth as offering "the framework to put all these pieces together" in a manner "that would have been very challenging to do privately." In the last three years, the combined firm's recurring income jumped 53% to $265 million.
Tiedemann's team "really thought long and hard about what would be a great path for the business," he said.
"That involves a lot of reflection," he said. "It forces you to evaluate the business and what could be complementary and what could be put together to create a really dynamic business."
Golden Gate's record of investing in financial services includes New York-based Pico Quantitative Trading, Sausalito, California-based separately managed account firm Aperio and insurance firms in Hartford, Connecticut-based Nassau Financial Group and Bermuda-based Mosaic Insurance. With the new influx, Parallel plans to boost its organic growth and pursue more M&A deals of its own, Golden Gate Managing Director Dan Haspel said in a statement.
"Parallel has demonstrated an impressive trajectory of both organic and inorganic growth, underscored by a holistic platform approach and full array of wealth services offerings," he said.
The 17-year-old RIA has more than 90 employees after adding Autus to the firm. Parallel works with high net worth clients and employers through their pension and profit-sharing plans and has additional offices outside its headquarters in Dayton, Ohio, Dallas, Honolulu and Oklahoma City. Its new acquisition, Autus, gives Parallel a boutique asset manager specializing in the individual selection of stocks and bonds.
Investment banking firm Republic Capital Group advised Autus on the deal to fold into Parallel, then represented the combined entity in identifying and choosing Golden Gate as the firm's new capital backer. In a press release, Republic described the deal negotiated by founder John Langston as "one of the most complex deals in wealth management to date."
"There are very few investment banking firms that could pull off such a complex transaction in this dynamic environment," Parallel Advisors CEO C.J. Rendic said in a statement. "We are honored to be clients and look forward to completing additional M&A deals with John and his team in the future."
