Emigrant Partners today announced it has made an undisclosed investment in independent registered investment advisor Ulrich Investment Consultants, a firm with more than $1.7 billion in assets under management that includes a distinctive client niche.
Ulrich has offices in San Antonio, Albuquerque, N.M., and Spokane, Wash. Along with providing comprehensive wealth management to high-net-worth individuals and families, in addition to handling ERISA plans, the firm also serves Native American tribes. According to its website, Ulrich partners with specialized firms with expertise in areas such as casino management and financial and debt structuring to help Native American governments establish strong economic foundations.
The firm was founded in 2007 by current president and CEO John Ulrich. In a press release announcing the transaction, he noted that Emigrant Partners’ investment in his company will enable it to grow while maintaining its independence and creating future partnership opportunities for its next generation of employees.
Emigrant Partners is a subsidiary of New York Private Bank & Trust, which is led by billionaire Howard Milstein. Its operating bank, Emigrant Bank, is billed as the nation’s largest privately held, family owned and operated bank.
In addition to owning Emigrant Partners, the bank also owns Fiduciary Network, which was launched by Mark Hurley in 2006 to make sizable minority investments in wealth management firms and provide them with long-term financing to help facilitate succession planning. Hurley ran the show, while NYPB&T held a 75% ownership stake in the entity through a subsidiary.
After Hurley and Milstein began feuding over control of Fiduciary Network in 2016, Hurley exercised his contractual right to trigger a forced sale of Fiduciary Network. Two arbitrations and multiple lawsuits ensued, and after bids were received during the auction for the entity, NYPB&T exercised its contractual right of first refusal to match the highest bid, according to one of the lawsuits. It bought Fiduciary Network outright in 2018, bought out shareholders, paid Hurley a 10% breakup fee and fired him. Some legal actions between Milstein and Hurley remain unresolved.
Karl Heckenberg, a financial services industry veteran who previously worked for Merrill Lynch, A.G. Edwards & Sons, Wells Fargo and Charles Schwab, took over as CEO of Fiduciary Trust. He is also CEO of Emigrant Partners, which was created in late 2018 to essentially do the same thing that Fiduciary Network does; namely, to make minority investments in—and provide capital for—wealth management firms to enable succession planning and various growth and strategic initiatives.
But Heckenberg says having dueling entities under the same umbrella isn’t a redundancy.
“They’re similar in design in terms of being a non-voting capital partner,” he said. “I think the biggest difference is that firms with Emigrant Parters are electing to work more closely with Emigrant Bank and its affiliates, which entails a private trust company, personal risk management and other affiliates.”
Another difference between Emigrant Partners and Fiduciary Network is that the latter limits its investments to fee-only firms, while the former has a broader mandate that also includes non-fee-only firms and asset and alternative asset management firms, he added.