Captrust Financial Advisors is acquiring MRA Associates, a Phoenix-based investment advisory firm with $3.29 billion in assets under management. It’s the latest deal for the large retirement-focused advisory firm, and will bolster Captrust’s expansion into the wealth management space, according to Rush Benton, senior director for strategic growth at the firm.
MRA’s addition will enable Captrust to offer income and estate tax compliance and consulting services, a new offering for its clients, according to Benton. In an interview with WealthManagement.com, Benton noted that the move would significantly boost Captrust’s presence in the Southwest. Additionally, MRA has a focus on the ultra-high-net-worth market, where Captrust has many clients but lacks a focused group servicing them.
“There’s an opportunity to learn from (MRA) and take their experience and expand it across our offices around the country,” Benton said.
MRA represents the 44th firm to join Captrust since 2006, and its Phoenix and Wayzata, Minn. locations will take on the larger firm’s name and branding. MRA was founded in 1991 and is led by Managing Partner and CEO Mark Feldman. In total, the firm consists of four managerial positions, along with 55 advisors and staff.
“The decision to join Captrust was an easy one once we understood the considerable level of scale we would be plugging into,” Feldman said. “I believe all of our clients will benefit greatly from the depth of the firm’s investment capabilities, as well their institutional capacity and leverage.”
With the retirement advisory space typically suffering smaller margins than wealth management businesses, Captrust has looked to inorganic growth to bolster its strength in the latter. In an interview with WealthManagement.com last year, Rick Shoff, managing director of Captrust's advisor group, said of the roughly 2,000 RIAs Captrust was considering purchasing, only 100 specialized in retirement advice. Benton believes RIA owners who are considering selling their business should look to firms that are large, national and have scale.
“Plugging into that firm and taking advantage of the scale is a way to instantly improve the client experience, or opportunities for your employees or the value creation for your shareholders,” Benton said. “And that’s where Captrust is.”
Captrust was considering adding other estate planning resources via acquisitions, and may at some point have a trust company or a dedicated family office, he said, though he stressed that there were no specific conversations underway and that the firm remained open to new opportunities. But expanding the firm’s wealth management business is important for its millions of retirement plan participants. Benton said that as they reached retirement age, they could transition into wealth management clients.
“It just makes sense,” he said. “The more wealth management offices we have around the country, the better chance we have to service that potential client base."