RIA merger and acquisition activity is still hot, but it’s not because of the RIAs themselves.
According to the latest Nuveen / DeVoe RIA Deal Book, RIA transaction activity is on track to achieve a third successive record year, however, RIAs were responsible for a declining portion of acquisitions during the second quarter.
“There’s definitely reason to believe that we’ll see a continuation of the trends we’ve seen thus far in 2017 to unfold over the next 12 nonths or so,” says David DeVoe, DeVoe & Company managing director. “We may, and in all likelihood we will, see a record year of activity, the consolidator space will continue to evolve, banks will make RIA acquisitions an initiative, new RIAs will conduct transactions and many of the RIAs that have already conducted deals will make one or more additional acquisitions this year.”
The first six months of 2017 yielded 82 mergers and acquisitions involving RIAs, according to DeVoe, versus 71 in the same period a year ago, an increase of 15 percent.
RIAs were responsible for 22 percent of the total acquisitions in the second quarter of 2017, declining from 29 percent in the first quarter.
“This is a significant decline, and it could be part of a short-term trend,” says DeVoe.