In seeking to
New York-based Steward Partners Global Advisory announced plans Wednesday to acquire Freedom Street Partners in a deal promising to bring $3.2 billion to its roughly $30 billion in assets under management. The acquisition, brokered for an undisclosed amount, is set to close before the end of the year.
By buying Freedom Street, Steward Partners will add 38 financial advisors and 17 offices to its roughly 200 advisor headcount and
Jim Gold, a founder and the CEO of Steward Partners, said in an interview Thursday that the division will be looking to acquire teams managing anywhere from $300 million to $10 billion. Gold said he thinks there's an opportunity to scoop up firms that value their independence but that are nonetheless looking for more back-end support amid tightening industry regulation and technology requirements.
He confirmed that one advantage to acquiring a company is that it eases the transition of client assets over to the purchasing firm. The wealth management industry has been plagued in recent years by lawsuits questioning advisors' right to take customer information with them after being acquired by a rival firm.
"It's a whole new area of growth that we've never really had the opportunity to take advantage of," Gold said.
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Steward Partner's new division will be run by Freedom Street Partners' management team and staff employees. Scott Danner, the CEO of Freedom Street Partners, agreed that providing continuity of customer service will be a priority.
The transition from Freedom Street to Steward Partners will be eased by the fact that both firms custody their clients' assets with
"In a continuity situation, where we can purchase the practice and help integrate and transition the advisor and not uproot those clients, that's always going to be a very valuable opportunity," Danner said.
Gold said Steward Partners will continue its
"Scott and I are going to be running around like planes, trains and automobiles in the next few months," Gold said.
Steward Partners' purchase of Freedom Street comes as its first standard merger and acquisition deal, AdvisorHub said when first reporting the firm's plans to acquire Freedom Street. Steward Partners' previous acquisition of
The Freedom Street advisors who are joining Steward Partners will gain equity interests in the firm and will be able to choose if they want to work as direct employees or as independent contractors. Teams whose members see retirement on the horizon will have the option of selling their business to Steward.
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Danner noted that the average age of advisors is now somewhere between 55 and 62. That means there are many firm owners out there who are likely trying to figure out what to do with their business when they retire.
"Our objective is to help take this trend to help guide advisors that are [in] the latter part of the career into the next chapter," Danner said.
Steward was formed in 2013 by a group of former employees of Morgan Stanley Smith Barney. It's backed by the private equity firm Cynosure Group and The Pritzker Organization, run by the ultrarich Pritzer family. It secured a $140 million line of credit from Apogem Capital, Manulife Investment Management and Cynosure in November 2022 in part to support its growth plans.
