Indianapolis-based consolidator Sanctuary Wealth announcecd that it has named former Ladenburg Thalmann chief operating officer Adam Malamed as CEO.
Malamed, a Sanctuary director for the last year, replaces Jim Dickson as CEO, effective immediately, according to a press release. Sources said Dickson's termination was abrupt as he was presiding at Sanctuary events earlier this week,
The move was described as part of Sanctuary’s plan to embark “on the next stage of growth,” the release said. Sanctuary has just under 100 partner firms and about $25 billion in assets, though it declined to reveal its revenues.
Many members of its top executive team, including Dickson, and members of its advisor network came out of Merrill Lynch. In an interview, Malamed acknowledged that the firm's strong suit was with breakaway brokers. Most partner firms are hybrid advisors who retain their securities licenses.
That differentiates Sanctuary from many private equity-backed aggregators, many of which have opted to focus exclusively on investing in RIAs. Part of the reason is that RIAs typically command higher multiples than hybrid firms. But with so many aggregators focusing on fee-only RIAs, Sanctuary may have found an opening in a less competitive lane.
Sanctuary was launched in 2018. Its largest shareholders are two private equity firms, Azimut, a global asset management firm, and, more recently, Kennedy Lewis, which invested in July 2022. Asked about private equity firms' frequent desire to exit their investments in five to seven years through sales or IPOs, Malamed said both private investors had long time horizons.
Malamed is described in the release as a principal architect of Ladenburg’s sale to Advisor Group for about $1.3 billion in 2020. In an interview, he noted he had experience in senior management at both public and private companies. He added that over the last five years, Sanctuary had recorded as fast a growth rate as any large wealth management firm in the nation.
Sanctuary is one of numerous private-equity-backed, advisor consolidator networks that have sprung up in the last decade. Asked about the connection with former Merrill executives and advisors, Malamed said Sanctuary was committed to high levels of service that the former New York brokerage was known for when it was an independent firm before it was acquired by Bank Of America during the 2008 financial crisis.
"I’m thrilled to lead Sanctuary Wealth as the firm embarks upon the next stage of its growth, which will be built on very strong foundations,” he said in the release. ”I look forward to applying my experience in leading and expanding some of the nation’s largest and most successful financial services companies to this new role.”
“Never before has there been a greater need for independent financial advice, and independent firms with sophisticated growth strategies are well-positioned to drive rising success for their organizations and advisors. Toward this end, I am a big believer in taking the best elements of a firm’s culture and aligning it with an institutionalized strategy and scalable solutions that consistently elevate the financial advisor and client service experience,” Malamed continued.