AssetMark Acquires Fellow TAMP Adhesion to Expand RIA Business

Deal Advisor ECHELON Sees TAMPs as Crucial Wealth Management Infrastructure, Expects More TAMP M&A Activity

AssetMark Financial Holdings announced it will acquire TAMP and wealthtech services provider Adhesion Wealth, which serves over 2,800 financial advisors across 180 RIAs, from Vestmark.

With a platform of over 400 managers and specialists, Adhesion provides outsourced investment management services to RIAs and asset managers such as managed account programs and outsourced overlay trading services as well as direct and personal indexing, tax management, portfolio administration, practice analytics and client reporting.

With this move, AssetMark, which already provides TAMP services for RIAs through its AssetMark Institutional arm, expands its capabilities and its book of clients in the RIA space.

Natalie Wolfsen, CEO of AssetMark, stated, “The addition of Adhesion Wealth further strengthens our ability to serve the rapidly expanding RIA market with an ecosystem of flexible, purpose-built solutions that drive growth, efficiency and scale.”

ECHELON Partners advised Adhesion and Vestmark on the transaction and Broadhaven Capital Partners advised AssetMark.

After the closing, expected in the second half of 2022, Adhesion will continue to operate its marketplace of modular solutions, currently the second largest in the wealth management industry.

WSR highlighted Wolfsen in March as part of our Pathfinder Awards, naming her among the Top Women Leaders in Wealth Management, as well as Michael Kim, AssetMark’s President and Chief Client Officer, who we named in May as AAPI Asset Management Executive of the Year.

TAMPs as “Pivotal Component” of Industry

ECHELON views TAMP acquisitions “as a pivotal component of the current evolution of the service structure and operational foundations of the traditional wealth management industry model.”

The investment bank states that TAMPs will catalyze the way wealth management firms and money managers operate and expects a high level of M&A activity in this space going forward.

Because TAMPs hold wealthtech infrastructures that integrate service providers, distribution networks, custodians and asset managers, ECHELON believes that TAMPs are attractive targets not only for larger TAMPs – such as AssetMark acquiring Adhesion – but also for a wide range of firms seeking entry into the industry or comprehensive platforms for financial advisors and professionals.

In addition, from the wealthtech angle, this transaction demonstrates the prioritization of technology among wealth and asset management firms as a means to increase cost efficiency and accelerate growth.

James Miller, Contributing Editor & Research Analyst at Wealth Solutions Report, can be reached at ContributingEd@wealthsolutionsreport.com