Mariner adds $104B in assets in 2-firm deal

In its largest acquisition to date, Mariner Wealth Advisors is buying two asset management firms with more than $100 billion under advisement and combining them into a new business line.

Overland Park, Kansas-based Mariner secured an agreement for "a simultaneous transaction" acquiring Winter Park, Fla.-based AndCo Consulting and Covington, Ky.-based Fourth Street Performance Partners — which together have 100 employees and $104 billion in assets under advisement on behalf of institutional clients, Mariner said Feb. 1. 

Upon the expected close in early April of the Jan. 29 deal, Fourth Street will merge into AndCo and the firms will operate under a new brand called Mariner Institutional through their existing teams and offices at the incoming firms' headquarters and six other locations. The assets changing hands is four times the amount of Mariner's previous high in a deal two years ago.

Mariner Wealth Advisors

The newly combined unit will absorb Mariner's existing 401(k) business of 20 employees and $4.5 billion in assets under advisement, Mariner CEO Marty Bicknell noted in an interview with Financial Planning. He met AndCo CEO Mike Welker through a referral from a Mariner financial advisor and recognized a chance to further its goal for "giving the individual client-facing advisor the opportunity to mold whatever offering the client wants to fit their needs," Bicknell said. The firm calls that approach its "One Mariner" strategy. 

"Fourth Street was a deal they were working on already, and so the opportunity to bring all of this together is just simply because they were already going down the road of acquiring Fourth Street," he said. "It's really transitioning from thinking of it as 'just a wealth firm.' We're truly becoming a financial services firm, and this is just helping us round that out a little more."

The parties didn't disclose the financial terms of the deal.

READ MORE: New Mariner mega-firm seeks to grow to 5,000 advisors

Mariner launched in 2006 with $300 million in client assets, but it ended 2023 with more than $122 billion under advisement. With outside investments of a reported $600 million from private equity firms Leonard Green & Partners in 2021, Mariner has completed giant deals in recent years such as acquiring The Financial Services Network and AdvicePeriod. 

Bicknell's firm completed seven acquisitions in 2023. The new business line joins more than a half dozen other related units listed on Mariner's Form ADV brochure, such as a brokerage, a trust company, an investment bank and an insurance agency. 

In an indirect collaboration with LPL Financial following the Financial Services Network deal in 2022, Mariner rebranded its registered investment advisory firm platform into a hybrid unit called the Mariner Advisor Network. The AdvicePeriod deal opened another different business specifically aimed at ultrahigh net worth clients called Mariner Ultra, Bicknell noted. His family office, 1248 Holdings, also invests in asset management firms through Montage, a unit spun off by Mariner in 2018. The RIA itself owns a private venture vehicle called Flyover Capital. 

Mariner and other RIA acquirers are taking a page out of the wirehouse playbook by acquiring firms that enable them to offer the full breadth of financial services, according to John Langston, the CEO of RIA investment bank Republic Capital Group.

"The expansion of services, I believe, is the most important trend in wealth management. … I hope it's dawning on people that is where we are going as an industry," Langston said in an interview. "We are working diligently to find ways to meet the same needs that clients have always had, but to do it as an advisor rather than as a purveyor of products."

READ MORE: Why last year's M&A drop-off may already be over

Incoming Mariner firms AndCo and Fourth Street name similar services on their websites, with each listing clients such as pensions, endowments, foundations, 401(k) plans and specialized consulting to companies, nonprofit organizations and other institutions. As Mariner Institutional, AndCo is taking the lead over the eight offices including the firms' outposts in Chicago, Dallas, Detroit, Pittsburgh, Cleveland and Reno, Nevada.

"Since the inception of the firm, we have consistently approached business decisions through a simple three-pronged question: how will this impact our clients, our colleagues and our community?" Welker said in a statement. "We truly believe we have found a partner in Mariner that shares the same philosophy, and I'm confident this opportunity will enhance the services we deliver to our existing clients, provide opportunities for our team members and give us capacity to give back to our local communities at scale."

Mariner currently spans more than 2,000 advisors across its businesses, and the firm has set a goal of reaching 5,000 by 2027. The addition of AndCo and Fourth Street "really elevates our ability" to work with foundations and endowments where many Mariner advisors are already sitting on the organizations' boards, Bicknell noted. The acquisition will push Mariner's count of offices nationwide above 100 for the first time and boost its direct corporate employees to 1,600.

Pointing out that RIAs are still "getting a lot of attention from capital providers," Bicknell echoed other dealmakers who argue that underlying factors will keep driving transactions this year and into the future. Most independent RIAs display "extremely high client retention rates" that come with consistently recurring revenue, he added. 

"We've been averaging 300 to 400 acquisitions a year, and the RIA count is still going up," Bicknell said. "We're not consolidating at a pace that the overall firms are declining, so that just tells me the consolidation is going to continue and maybe even accelerate."