Thursday, December 24, 2015

HighTower Acquires Investment Adviser Managing $700 Million in Assets

HighTower Acquires Investment Adviser Managing $700 Million in Assets

Deal for RDM Financial Group marks relatively new strategy for Chicago firm

HighTower Advisors LLC has acquired a Westport, Conn., registered investment adviser managing $700 million in client assets as it makes a push to attract more independent advisers to its brand.
The firm announced Thursday that it acquired RDM Financial Group, which is led by Chief Executive Ron Weiner, for an undisclosed amount. 
Mr. Weiner will maintain his 15-person team at the firm’s Westport and Boca Raton, Fla., locations. He also will have an office with HighTower in New York.
The Chicago-based firm, which was founded in 2008 and has registered investment adviser and brokerage operations, had originally concentrated on hiring brokers away from big securities firms as HighTower employees.This type of acquisition is a relatively new strategic focus for HighTower.
HighTower Chief Executive Elliot Weissbluth said the financial arrangement in buying an advisory practice is similar to how the company attracts brokerage teams, meaning there is an upfront payment made to the advisers to transition their book of business to HighTower and become employees. He declined to provide details.
In 2012, HighTower added programs called HighTower Alliance and HighTower Network to attract independent advisers to the firm. It merged those entities earlier this year to form its Independent Platform Business.
Mr. Weissbluth said the multiple avenues for advisers to join HighTower won’t work against one another and will entice a wider swath of the wealth-management industry to consider its services.Advisers who join through the independent platform can chose which services to use, whether to operate under the HighTower brand and if they want to work under HighTower’s oversight and regulatory compliance or manage that on their own. Independent-platform advisers pay a percentage of their revenue in exchange for HighTower’s services.
He said he is seeing significant interest among independent registered investment advisers in being acquired, which he attributed to increasing regulation, cost pressures and the inability of independent advisers to keep up with the fast-changing technology of big securities firms.
These advisory firms “are usually small businesses trying to compete with large firms,” he said.

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