M&A Activity Peaked in 2010

There were 109 merger-and-acquisition deals involving RIAs in 2010, according to Schwab Advisor Services. The total number of deals made last year the busiest year for M&A transactions since Schwab started tracking activity in 2003. Small firms ruled, as 58% of deals represented less than $500 million in assets under management, according to the custodian's report on industry-wide RIA mergers and acquisitions. But that doesn't mean consolidation among small firms will change the makeup of the industry, according to Dave DeVoe, managing director of strategic development at Schwab. New firms entering the industry and advisors starting their own firms offset the consolidation. Transactions in 2010 represented about $156 billion in total assets under management, compared with about $103 billion in 2009. On average, the 2010 transaction size was $1.4 billion, compared with $1.5 billion in 2009.

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