M&A for RIAs on the wane, study says
This year through April, just seven deals for RIAs were struck, in contrast to last year, when there were 58 deals.
The mergers and acquisitions market for registered investment advisers is seeing a short-term slowdown this year, but the appetite for deals will remain strong in the long run.
That is one of the conclusions of an updated study presented by Pershing LLC at its annual meeting, Insite, in Hollywood, Fla.
This year through April, just seven deals for RIAs were struck.
That is in contrast to last year, when 58 deals were consummated, according to the biannual study, “Real Deals 2008: Defined Information on Mergers and Acquisitions for Advisers.”
There are a variety of reasons for the current dearth of deals, said Philip Palaveev, president of Fusion Advisor Network of Elmsford, N.Y., who presented the study here yesterday. “In some cases, capital has dried up,” he said.
Another factor was that “some strategic players have become distracted” by the general turmoil in the market, Mr. Palaveev said.
Valuations for firms were holding steady, he said, but prices for “premium” firms are likely to go up because of scarcity.
Last year was a banner year for mergers and acquisitions for RIAs.
The number of deals increased 53% compared with 2006 and was double the number in 2003, according to the study.
Pershing. of Jersey City, N.J., last completed the Real Deals study in 2006.
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