It has been a busy week for Mercer Advisors Inc., and it’s still just Wednesday.
The ever-acquisitive Denver-based company, which is the parent of registered investment advisor Mercer Global Advisors Inc., today announced its purchase of ClearRock Capital LLC, a firm with offices in Ketchum, Idaho, and San Francisco that serves roughly 250 households with more than $660 million in assets under management.
The day before, it announced its acquisition of Argosy Wealth Management Inc., an RIA in Los Angeles with a client base of about 300 households with around $330 million in assets.
Established in 1985, Mercer Advisors began its incarnation as a serial consolidator after it bought Kanaly Trust Inc. in a stock merger in 2016, and it bolstered that push when it beefed up its M&A staff in 2018. Prior to the Kanaly deal, Mercer had roughly $6 billion in client assets, 140 employees and 15 branch offices across the country.
Following the two purchases announced this week, Mercer has roughly $19.2 billion in client assets, 400 employees and 45 offices across the U.S., making it one of the country’s largest RIAs and financial planning firms.
Regarding the ClearRock Capital deal, the firm’s two co-founders and current top executives, Mark Eshman and James Everitt, along with their eight staff members, will come on board at Mercer Advisors.
According to a press release, ClearRock is a holistic wealth management firm founded in 2007 that serves high-net-worth individuals, foundations and endowments, including small-business retirement plans.
Argosy Wealth Management was co-founded by Michael Karon and Alex Kimura in 2010. Both hold the certified financial planner designation, and both go by the job title of investment advisor representative.
According to his bio on Argosy’s website, Kimura found his calling as an advisor to others after he spent several months at a Zen monastery near the Japan Alps.
Karon took a different path, when as a graduate student in the late-1980s he set out to learn as much as possible about the theory and practice of financial decision making with the goal to create “a better way to level the playing field,” according to his company bio.
The two co-founders and the rest of their seven-person staff provide financial planning and institutional-level investment management to the firm's high-net-worth clients.
For Mercer Advisors, these two acquisitions were its first transactions since it did two deals in January that brought nearly $500 million into the fold. And more deals are on the way.
"I think we'll have a banner year and will double the amount of AUM over last year, so we'll see probably see more than $4 billion in acquired AUM," Dave Barton, Mercer Advisors' vice chairman and M&A leader, said in an interview.
He noted that Mercer made 11 acquistions last year, which was its highest one-year total to date. And while Barton expects to complete about the same number of deals this year, he anticipates the amount of acquired assets will signficantly increase because deal sizes will be bigger.
"I think Covid really shook the trees, and people who were fence sitters and thinking, 'Eh, I'll just put this off another year, or I'll get my succession or business continuity plan together next year' . . . I think that really woke them up," Barton said.
"That sharp a market drop over that short a period of time was a huge hit for smaller firms," he added. "That chunk falls right out of their bottom line, which is normally their paycheck. And that hurts."