Articles / Resources

What’s Next For Nick Schorsch?

17:26 03 March in In the News by rafferty

By Dan Jamieson March 3, 2014,Financial Advisor Can Nick Schorsch really pull off his plan to create a new major player in the independent broker-dealer space? The industry is watching intently as the firm Schorsch controls, RCS Capital Corp., begins the arduous task of putting together what will be one of the biggest players among independents—with more than 9,000 advisors and around $200 billion of client assets. Publicly traded RCS Capital (RCAP) boldly staked its claim as a major independent firm in January when it agreed to buy Cetera Financial Group with its nearly 6,700 advisors and $145 billion in client assets, quickly followed by another deal, for J.P. Turner ($4.3 billion in assets and 325 advisors). Those acquisitions followed earlier purchases of First Allied Securities, Investors Capital Holdings and Summit Financial Services, all...

Schorsch’s RCS Capital moves to keep its 9,000 registered reps in the fold

23:04 19 February in In the News by rafferty

February 19, 2014, By Bruce Kelly, Investment News Retention plan includes stock ownership and as forgivable loan program In a highly anticipated move, RCS Capital Corp. said that it intends to create a retention package for the 9,000 registered representatives and investment advisers, many of whom it has inherited from a series of acquisitions. RCS Capital and related entities have been on a buying binge of broker-dealers over the past seven months, completing one acquisition while four others are pending and on track to close by midyear. Such broker-dealer acquisitions can prove highly sensitive and contentious as reps and advisers question the new ownership. It is customary to offer reps and advisers some sort of compensation for them to stay on the job for a number of years. Nicholas Schorsch, who five years ago began...

Did Schorsch Overpay for Cetera?

16:59 18 February in In the News by rafferty

Diana BrittonJanuary 16, 2014 Rep Magazine and wealthmanagement.com RCS Capital Corp.’s Nicholas Schorsch paid one times revenue for Cetera Financial, when IBDs typically sell for 30-40 percent. Did he overpay? Nicholas Schorsch, head of RCS Capital Corp. (RCAP), announced Thursday that he was buying Cetera Financial from private equity firm Lightyear Capital for about one times Cetera’s trailing 12-month revenue. In the IBD space, that's a steep multiple. Because of their small profit margins, independent broker/dealers tend to sell for 30 to 40 percent of their trailing 12-month revenue, said Jonathan Henschen, president of recruiting firm Henschen & Associates. Schorsch bought the firm for $1.15 billion in cash; Cetera’s estimated 2013 revenue was $1.14 billion, RCAP said on an investor call this morning. The transaction was all cash, making the deal even more...

AIG Hones Its Network Amid A Pullback

16:26 28 January in In the News by rafferty

January 17, 2014By Cyril Tuohy, InsuranceNewsNet A juggernaut has stirred. The announcement that American General was rebranding its 1,400-strong distribution arm to American International Group Financial Network (AIG) and expanding the network’s scope will likely raise eyebrows in the corporate suites of Prudential, MetLife and Northwestern Mutual. It’s a move that was a long time coming, some market observers said, and will breathe more life into the distribution network of the Houston-based life insurance giant. American General itself was added to the sprawling AIG umbrella in the wake of a 2001 acquisition. For years, American General’s 1,400 advisors – mostly captive agents – ploughed through the day selling American General’s suite of protection products like life and disability insurance, but now they are going to be selling the company’s proprietary mutual funds and retirement...