$4.8B team exits UBS to launch private equity-backed RIA
A quartet of wirehouse advisors managing nearly $5 billion in client assets launched an independent RIA under a private equity-backed holding company.
Financial advisors Jeffrey Kobernick, Robert Sechan, Walter Granruth and John Straus Jr. left UBS to start NewEdge Wealth, the team said Dec. 14. NewEdge is a partnership with EdgeCo Holdings, which is backed by private equity firms Parthenon Capital Partners and Waterfall Asset Management. EdgeCo also owns the team’s broker-dealer, Mid Atlantic Capital Group.
The move is the largest recruiting grab in the IBD sector in 2020, in terms of client assets, according toFinancial Planning’s tracking of announcements. A team with $3.75 billion unveiled the sector’s second biggest move of the year earlier this month. Pittsburgh-based NewEdge’s founders had each spent a decade or more with UBS, according to FINRA BrokerCheck.
“New patterns and trends emerge, and we need to be nimble in order to optimize solutions and advance on client goals,” Sechan said in a statement. The RIA “presents a new opportunity for us to customize investment and wealth management strategies that meet complex needs and objectives without many of the constraints found at larger firms,” Sechan added.
Representatives for UBS declined to comment on the advisors’ departure.
In addition to its portfolio firms Mid Atlantic and retirement plan administrator firm American Trust, EdgeCo also acquired an ultrahigh-net-worth strategy company founded by John Straus Sr., Private Wealth Partners, earlier this year. As a current president of New Edge, Straus Sr. helped design the new RIA’s technology and investment platform.
His son and the other three founders of Pittsburgh-based NewEdge managed $4.8 billion in client assets with their previous firm. They affiliated with the new RIA and Mid Atlantic on Dec. 11, BrokerCheck shows.
“We took great care in making the decision of who to partner with for this next phase of our business,” Kobernick said in a statement. He added that they chose EdgeCo due to it “positioning us to keep up with the evolving landscape, providing the best-in-class solutions for our clients and operating on a true open architecture platform.”
Kobernick and Sechan had each spent a dozen years with UBS after tenures with Lehman Brothers and Morgan Stanley in careers spanning nearly three decades. Granruth was with UBS for 18 years. And Strauss Jr. had spent all 10 years of his financial services career with the wirehouse prior to launching the new RIA. Barron’s first reported their move.
Mid Atlantic has 70 registered representatives, and its corporate RIA has $3 billion in assets under management from nearly 8,500 accounts, according to SEC Form ADV. Across Mid Atlantic and American Trust, EdgeCo’s firms have $130 billion in client assets under custody or administration, more than 15,000 financial advisors and 500 financial institutions.