Emigrant Partners, a business arm of New York Private Bank & Trust subsidiary Emigrant Bank, took a non-voting minority stake in Parallel Advisors, a San Francisco-based wealth management firm with $3 billion in client assets. This is Emigrant’s second investment since the onset of the coronavirus pandemic, following its deal with Stratos Wealth Holdings in Beachwood, Ohio in early April.
“[Emigrant] will enable us to augment the advice and expand the services we provide our clients,” said C.J. Rendic, the founder and CEO of Parallel Advisors, in a statement. “This Parallel/Emigrant combination will also empower us to offer true partnership opportunities through economic incentives and our collaborative culture to attract and retain more of the highest caliber advisors in the industry.”
Republic Capital Group, a firm that advises on mergers and acquisitions, matched Parallel with Emigrant and served as the RIA’s advisor throughout the transaction.
Parallel provides long-term planning, portfolio management, retirement lifestyle solutions, and tax and estate consulting and determinations for pension and profit-sharing plans, as well as high-net-worth individuals.
Emigrant will be a capital source for Parallel’s future acquisitions. Since its founding Parallel has spread into markets in Dayton, Ohio; Denver, Honolulu and Oklahoma City. Emigrant, a capital and advisory services partner, will also provide benchmarking services and consulting for compliance, private vehicle funds, human resources, real estate, vendor management and other matters.
“The fact that [Parallel] included their entire partnership group, which is 26 people, into the search process and actually voted on it, gives us a great deal of comfort that everyone is on board and this is strategic for the firm,” said Karl Heckenberg, CEO of Emigrant Partners.
Emigrant plans to make another investment in a large firm at the end of the month. Along with its affiliate Fiduciary Network, Emigrant has made 16 investments and collectively oversees more than $50 billion in assets.
Heckenberg said the company is looking at the pandemic as an opportunity to invest into more businesses and flex its ability to continue business as usual. While mergers and acquisitions have slowed this year partly because of limited access to credit, Emigrant's bank connection gives it and its wealth management firms access to capital quicker than others.
“We’re not dependent on third-party financing to make most of our investments, which most of our competitors are. They’re reliant on the traditional debt markets. Given what’s happening it’s not as easy to get credit as it used to be. We see it as a huge advantage to us to be able to move quickly,” he said.