ECHELON: 2022 M&A Volume Broke Records, Due To Private Equity Backers

Chris Latham, Deputy Managing Editor, Wealth Solutions Report

2022 Had 340 M&A Deals – The Most Ever – As Deal Size Declined, According To ECHELON

An ECHELON Partners full year brief on the state of mergers and acquisitions in the RIA space reveals that 2022 deal volume broke the annual record thanks in large part to private equity firms even as deal size declined from 2021 and quarterly deal flow slowed, while strategic acquirers and consolidators conducted most of the moves.

These findings are largely in keeping with our coverage of ECHELON’s third quarter report. Here are the top four points from ECHELON’s new 2022 Executive Brief:

1. Overall 2022 had 340 total wealth management transactions, compared with 307 total deals in 2021 and 205 in 2020. In Q4 2022, 71 transactions occurred compared with 99 transactions in Q4 2021, and quarterly deal volume decreased consecutively during that time period, according to ECHELON. 


2. ECHELON reported that the average assets per M&A deal fell to $1.6 billion in 2022 from $2.09 billion in 2021 and $1.75 billion in 2020. However, deal values did remain above pre-pandemic levels. The average assets per M&A deal were $1.47 billion in 2019 and $1.27 billion in 2018. The biggest deal of 2022 was Madison Dearborn’s agreement in December to acquire the Collective Investment Trust (CIT) business of M&T Bank’s Wilmington Trust, which reflects CIT assets of approximately $115 billion. 


3. “Nearly all of the most active strategic acquirers are backed by prominent private equity firms,” according to ECHELON, which found that private equity firms either directly invested in or backed acquirers in 69.7% of all deals last year. One prominent example was Genstar Capital leading a $45 billion recapitalization of Cerity Partners in June.

Mercer and Merit have been actively acquiring assets.

4. Strategic acquirers and consolidators accounted for 43% of all M&A deals in 2022 while RIAs accounted for 28% of deals, ECHELON found. The most active firm in the strategic acquirer / consolidator category last year was Mercer Advisors, which conducted 20 deals reflecting $13.3 billion in assets. Merit Financial Advisors was the most active RIA, which conducted 11 deals reflecting $4.8 billion in assets.

For more information, download the full report here.

Chris Latham, Deputy Managing Editor at Wealth Solutions Report, can be reached at clatham@wealthsolutionsreport.com

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