Schorsch snaps up Cetera for $1.15B

In a head-turning move, newcomer to the independent broker-dealer industry Nicholas Schorsch is pulling off the largest independent-broker-dealer acquisition in years, with a cash deal to buy Cetera Financial Group.
MAY 21, 2014
In a head-turning move, newcomer to the independent broker-dealer industry Nicholas Schorsch is pulling off the largest independent-broker-dealer acquisition in years. His broker-dealer holding company, RCS Capital Corp., announced Thursday that he intends to buy Cetera Financial Group Inc., a leading network of four broker-dealers and 6,600 registered representatives and financial advisers, from Lightyear Capital. The cash deal is worth $1.15 billion, according a statement released by RCS Capital. Mr. Schorsch is starting off 2014 right where he left off last year, when he completed the acquisition of one broker-dealer holding company, First Allied Securities Inc., and announced two others, Investors Capital Holdings Inc. and Summit Financial Services Group Inc. Once those three firms and the four Cetera broker-dealers are under Mr. Schorsch's roof, he will have 9,000 reps and advisers producing about $1.4 billion in annual revenue. A Cetera acquisition would make his broker-dealer holdings either the third- or fourth-largest network of independent reps and advisers. Mr. Schorsch isn't afraid to ruffle feathers in the financial services industry. Over the past five years, he has turned the nontraded real estate investment trust industry on its ear, speeding up the return of capital to investors to the delight of many investment advisers. With dozens of independent broker-dealers as outlets, American Realty Capital, his real estate company, was the biggest seller of nontraded REITs and nontraded business development companies over the past two years. ARC raised $2.8 billion in equity in 2012 and $8.3 billion in 2013, far outpacing the competition. Last year, Mr. Schorsch made a pivot away from producing new nontraded REITs and began buying broker-dealers and other financial services companies. Finishing the pending acquisition of Cetera would complete his transition from a REIT czar to a broker-dealer leader. (Don't miss: Nick Schorsch's year-long buying binge and Schorsch snares the brass ring he missed the first time with Cole deal. Also: Cetera skyrockets into first tier.) (See Schorsch on separating the REITs from the chaff.)

Latest News

Buy or sell Canada? Wealth managers watch carefully as Canadians head to the polls
Buy or sell Canada? Wealth managers watch carefully as Canadians head to the polls

Canadian stocks are on a roll in 2025 as the country prepares to name a new Prime Minister.

How are tech-boosted advisors spending their "time tax refund"?
How are tech-boosted advisors spending their "time tax refund"?

Two C-level leaders reveal the new time-saving tools they've implemented and what advisors are doing with their newly freed-up hours.

Indivisible Partners selects DPL to arm advisors for insurance business
Indivisible Partners selects DPL to arm advisors for insurance business

The RIA led by Merrill Lynch veteran John Thiel is helping its advisors take part in the growing trend toward fee-based annuities.

RIA M&A stays brisk in first quarter with record pace of dealmaking
RIA M&A stays brisk in first quarter with record pace of dealmaking

Driven by robust transaction activity amid market turbulence and increased focus on billion-dollar plus targets, Echelon Partners expects another all-time high in 2025.

New York Dems push for return of tax on stock sales
New York Dems push for return of tax on stock sales

The looming threat of federal funding cuts to state and local governments has lawmakers weighing a levy that was phased out in 1981.

SPONSORED Compliance in real time: Technology's expanding role in RIA oversight

RIAs face rising regulatory pressure in 2025. Forward-looking firms are responding with embedded technology, not more paperwork.

SPONSORED Advisory firms confront crossroads amid historic wealth transfer

As inheritances are set to reshape client portfolios and next-gen heirs demand digital-first experiences, firms are retooling their wealth tech stacks and succession models in real time.