Kestra Financial acquired the independent advisory firm H. Beck – and more than $2 billion in assets under management – continuing record levels of M&A activity during the first half of the year.
Kestra, based in Austin, Texas, agreed to terms with Securian Financial Group, which acquired H. Beck nine years ago.
H. Beck, headquartered in Bethesda, Maryland, will remain an independent RIA and broker-dealer, and maintain full autonomy over their branding and executive team, according to a Kestra spokesperson.
The firm provides services to more than 600 advisors, according to a company release, and listed 11,500 clients and $2.4 billion in assets under management on its latest Form ADV, filed in June.
AUTONOMY 'MADE SENSE'
Kestra chief executive James Poer says the decision to give H. Beck autonomy made sense from an operations standpoint.
“We didn’t want to create any sort of transitional challenges,” Poer says, adding that a merger would have added a significant amount of volume to their current systems. “They’re separate entities and offer unique value in the market place.”
Kestra’s advisory services subsidiary has more than 1,200 employees and approximately 66,000 clients listed on their latest Form ADV filed in August. With approximately $16 billion in assets under management, more than a quarter of the firm’s clients are listed as high-net-worth individuals.
“There’s a lot of opportunity out in the marketplace,” Poer says. “We have to continue finding good fits for us.”
The terms of the deal were not disclosed.
SEARCH FOR NEW PRESIDENT
Kestra had been in the acquisition market since spinning off of the insurance brokerage and consulting firm NFP over a year ago, Poer says.
“We like the organization, its history and its culture,” Poer says of H. Beck. “They have great advisors and a really bright staff.”
A search for a new president of H.Beck is already underway, Poer says, after former president Loyall Wilson retired. The new president will report to Poer.
“We have a lot of confidence in our team in Maryland,” Poer says.
Poer says the deal will increase value, while minimizing disruption.
“It’s difficult to merge businesses in this space,” Poer says. “But, there are a lot of opportunities achieved scale-wise without driving advisors through a lot of change.”
The deal is expected to close before the end of the year.
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