Chicago-based Cerity Partners has merged with Karsten Advisors of Fort Worth, Texas, a hybrid RIA with $500 million in client assets under management. Karsten Advisors will now be known as Cerity Partners.
Cerity Partners has the financial backing of Lightyear Capital, which bought a 50 percent stake in the RIA in January 2018. The remaining half of the firm is employee-owned, according to Kurt Miscinski, Cerity Partners president and CEO.
While Cerity Partners is a younger firm than Karsten Advisors, it has grown quickly. Founded in 2009 as HPM Partners, the company rebranded earlier this year, using a modified version of the word “sincerity” in its name to reflect its mission of service to its clients, according to a company press release.
The firm operates under what it describes on its website as a private partnership model, serving high-net-worth individuals and their families, businesses and their employees, and nonprofit organizations.
Miscinski said that Karsten Advisors had both deep knowledge of the regional markets in Texas and Colorado and decades of experience, enabling Cerity Partners to more effectively serve local communities through their partnership, and that Cerity finds "the Texas market to be very attractive with strong geographic growth."
Miscinski said that his company preferred to acquire its partners through a merger, rather than affiliating with them through other means.
“A merger enables us to assess what they’re doing,” Miscinski said. “When you’re recruiting someone, you’re taking a risk. We have a greater amount of detail through a merger, with a greater chance of success. We think that a merger offers a very attractive way to enter a market.”
Last month, Cerity Partners bought Blue Prairie Group, which manages $11 billion in retirement plan assets. With a second merger this month of Karsten Advisors, Cerity Partners has added close to $12 billion in assets under advisement (AUA), nearly doubling its total AUA to almost $22 billion.