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In the News

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Warburg-Kestra deal signals challenges ahead

17:22 04 March in In the News by rafferty

March 1, 2019 By Tobias Salinger, Financial Planning It may have a track record in wealth management, but Warburg Pincus is entering the independent broker-dealer sector at a challenging time. Stone Point Capital has agreed to sell a majority stake in Kestra Financial to the global private equity firm roughly three years after buying the ownership position, the firms announced on Feb. 25. The parties didn’t disclose the terms of the deal, but reports have said it may value Kestra at as much as $800 million — or 8 to 10 times its EBITDA. Beyond regulatory approval, the agreement must win over the 2,300 advisors who would balk at disruption to their practices at Kestra and subsidiaries Kestra Private Wealth and H. Beck. The deal also comes after the Dow hit record highs 15...

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What Kestra’s Warburg Pincus Deal Means for Its Future

18:43 27 February in In the News by rafferty

February 25, 2019 By Janet Levaux, ThinkAdvisor Independent broker-dealer Kestra Financial is being bought by the private equity group Warburg Pincus, the firm said early Monday. Its prior owner, Stone Point Capital, will keep a minority stake in it, as will its management and possibly some of Kestra’s roughly 2,000 affiliated advisors. Warburg Pincus comes with some fairly deep pockets — $43 billion in assets in under management invested in about 180 companies. Stone Point works with $19 billion. “Warburg is a savvy PE firm in the space, with an investment in Facet Wealth and prior investments in The Mutual Fund Store and Financial Engines,” said Chip Roame, head of the consulting firm Tiburon Strategic Advisors. “This move continues a trend of PE firms acquiring IBDs.” Other industry watchers, like Nexus Strategy’s Tim Welsh, agree. “For...

Financial Advisor IQ a Financial Times Service

Why Advisors Left Wirehouses for B-Ds and Independents

17:41 22 February in In the News by rafferty

February 21, 2019 By Mrinalini Krishna, FinancialAdvisor IQ Wirehouse advisors were on the move in 2018 and non-wirehouse broker-dealer firms were among the big beneficiaries. While each non-wirehouse broker-dealer offered its own incentives for advisors to come on board, recruiters say it was generally frustration beyond money matters that drove wirehouse advisors towards the non-wirehouse crowd. Based on advisor headcounts presented in 2018 annual company filings, average wirehouse advisor strength diminished by 1%, whereas, on average, rosters at non-wirehouse, regional, national and independent firms grew by 4.39%. Stifel Financial ended the year with 57 net new additions to its advisor count in 2018 and the firm’s head of recruiting, John Pierce, told FA-IQ in December that his firm had become “a destination for wirehouse advisors.” Continuing its previously robust advisor growth, Raymond James saw its advisor...