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Hightower's Strategic Acquisition Drive Rolls On
Tom Burroughes
2 April 2020
US-based Hightower yesterday said it has made a “strategic investment” in Wellspring Associates, a boutique wealth planning and consulting firm specializing in estate, tax, philanthropic and legacy planning for ultra-high net worth families and individuals. This development is another example of the sort of M&A activity happening in the US wealth management space, and likely to continue because of regulatory costs, the demand for scale and the desire by some business owners for an exit. Recent deals include Fiduciary Trust’s purchase of Pennsylvania Trust, a well-established wealth manager in the region. It also recently bought Athena Capital Advisors. Large M&A marriages include last year’s Charles Schwab/TD Ameritrade hook-up and February’s Morgan Stanley/E*TRADE deal. Other prominent agreements include Warburg Pincus and Kestra Financial; Reverence Capital Partners and Advisor Group; Goldman Sachs and United Capital; Principal Financial and Wells Fargo; Envestnet and TXN, and MoneyGuidePro. Wellspring In February media reports said the private equity owner of HighTower Advisors, Thomas H Lee Partners, was looking at how to exit its stake in the firm, possibly by a sale. The private equity firm declined to comment.
Wellspring has offices in Atlanta and Dallas, serving families each with an average of $50 million or more in assets, according to a statement from Hightower yesterday. Wellspring will expand its offering and act as a resource for Hightower advisory businesses. It will also expand its offering to high net worth families with assets of $5 million and up, the firm said.
“As an estate and tax-planning business, the Wellspring transaction represents a new dimension of Hightower’s M&A activity: We are actively using our size and scale to provide additional resources, capabilities and value to our advisors by giving them access to intergenerational wealth transfer and legacy planning services they may not otherwise have,” Bob Oros, CEO of Hightower, said.
The size of the investment stake was not disclosed.
Founded in 1981, Wellspring has five wealth integration teams, with a total of 15 employees. Its Wealth Integration Solution™ helps clients clarify their goals and family legacy, and integrates their financial advisor, family office, attorney, corporate attorney and CPA into the process of wealth transfer, business succession and philanthropic planning.
“This collaboration, as well as Hightower’s strategic support and operational infrastructure, will help us exponentially grow and scale our client base,” Greg Raabe, managing director at Wellspring Associates, said.
Recent Hightower transactions include Schultz Collins, Lexington Wealth Management, LourdMurray, Green Square Wealth Management, WealthTrust and Salient Private Client . As of December 31, 2019, Hightower had about $76.8 billion in assets under administration. Hightower has also rebranded.