While not approaching the record-breaking activity seen during the first quarter, April 2021 was another active month for M&A activity.
According to the Fidelity Wealth Management M&A Transaction Report, which reviews M&A activity among Registered Investment Advisors (RIAs) and Independent Broker-Dealers (IBDs), M&A activity in April was led by serial strategic acquirers seeking more scale, geographic expansion and a larger share of market.
There was a total of 14 RIA deals representing $15.2 billion in client AUM for the month of April. And in the first four months of 2021, there have been 60 RIA deals totaling $106.5 billion in client AUM, Fidelity notes. By contrast, the same period in 2020—which included two extremely slow months as the COVID-19 pandemic unfolded—saw roughly half as many deals (32) and just one-quarter (25%) of the April 2021 year-to-date AUM dealmaking ($32 billion).
What’s more, large transactions comprise a growing share of transaction activity, with 73% of deals over $500 million in AUM and 53% over $1 billion for the year-to-date. In fact, there were six $1 billion-plus RIA deals in April alone, Fidelity notes. And the 32 $1 billion-plus RIA deals in 2021 has already surpassed 2019 and set a new six-month record—previously reached during July-December 2020, which saw 28 $1 billion-plus RIA deals.
Striving for full integration, branded acquirers drove nearly half (29 out of 60) of all deals and account for nearly 33% of the year’s AUM.
Fidelity notes that during April, Beacon Pointe Advisors (three), Creative Planning (two), Wealth Enhancement Group, Allworth Financial and MAI Capital Management completed a combined eight transactions. Focus Financial also completed two deals, while Creative Planning’s acquisition of $5.1 billion SBSB and the merger of Coldstream and Paracle Advisors into a $5.7 billion entity were also notable deals, the report notes.
Meanwhile, after an active first quarter, there were no IBD transactions in April.
