Wealth Enhancement Group is pushing its assets under management above the $90 billion mark with the purchase of a hybrid firm.
Wealth Enhancement Group, a private equity-backed aggregator in Minneapolis, announced Thursday that it's buying Philadelphia-based Levy Wealth Management Group for an undisclosed amount. Levy Wealth's $1.3 billion in assets under management will push Wealth Enhancement's total AUM to $90.5 billion.
Wealth Enhancement Group is one of the private equity-supported firms driving many of the mergers and acquisitions that have become prevalent in the financial planning industry. The consulting firm and investment bank Echelon Partners notes in its latest
Wealth Enhancement,
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Its size allows it to eliminate redundancies among the various firms it acquires and operate efficiently, he said. It has shown again and again that it can grow through acquisitions. It has struck custodial relationships with some of the best-known firms in the business for the safekeeping of client assets. And it helps its advisors attain organic growth through its marketing services and other support.
"I don't know of another firm that has those four engines humming along quite as well," Nash said.
As for Levy Wealth, its more than $1 billion under management is just the sort of thing that RIA aggregators like Wealth Enhancement Group are looking to acquire, Echelon wrote. Acquirers announced 65 deals with firms topping the billion-dollar mark in the first half of the year, putting the industry on pace to exceed the number of such transactions logged in the previous two years, according to the report.
"Firms with over $1 [billion] in assets are particularly attractive to acquirers as they tend to be well-established firms with defined processes and excellent client retention records," Echelon wrote.
Levy Wealth ticks both the billion dollar-plus and the well-established boxes. The firm grew out of disability-insurance brokerage founded by Leon Levy in 1972. Levy son, David, eventually took over the group insurance side of the business and his other son, Victor, moved forward with wealth management.
Levy Wealth Management Group specializes in working with medical professionals, business owners and families, and offers services ranging from wealth management to tax, estate and financial planning. At Wealth Enhancement, it will operate as
Victor Levy, president of Levy Wealth, said he and his colleagues talked to other private equity-backed RIAs before choosing to go with Wealth Enhancement.
"They had everything we were looking for — a full selection of custodians, systems that were integrated with many of our systems, and a strong culture connection which was client centric," Levy said in an email. "I liked the quality of the firms that were joining, many of whom resembled our approach to wealth management."
Wealth Enhancement Group has agreements to custody clients' assets for safekeeping with firms including Charles Schwab, LPL Financial, Fidelity, Pershing and Raymond James,
The firm now has 150 offices, according to its press release.
"As we continue to grow our east coast presence, we're excited to be joined by Victor and his team at Levy Wealth Management Group," said Jim Cahn, the chief strategy officer of Wealth Enhancement Group.
