Sell-And-Stay Versus Sell-And-Leave Acquisitions
by Jeff Nash, Founder & CEO, BridgeMark Strategies
Article Source: AdvisorHub
As Industry Consolidation Escalates, Sell-and-Stay Deals Rise in Popularity
As consolidation across the independent wealth management space increases, the demand among RIA and dual registrant enterprises for acquisitions of small- to mid-sized practices – independent financial advisor businesses encompassing $50 million to $200 million in assets –continues to intensify. This is especially the case with independent practices with a record of strong organic growth.
As always, there is no one-size-fits-all approach for accelerating a deal process. But these days, buyers of independent practices are seeing more and more sellers with premium practices optimizing their bargaining power by negotiating terms that better align with a broader array of short- and long-term goals. As a result, the traditional “sell and move on” transaction model has been declining in favor of “sell and stay” deals.
To be sure, there will always be a meaningful percentage of independent practice sellers who are ready to get out of Dodge when their business is acquired and fully exit the industry at the earliest possible date certain.
