Hightower will make a strategic investment in Investment Security Group, a Denver-based wealth management firm with $800 million in managed assets. In announcing the deal, Hightower Chairman and CEO Bob Oros said the firm was “poised for expansion in a highly coveted geography.”
Investment Security Group was founded in 1992 and is headed by CEO Mitch Powers, along with CFO Barbara Krause, CCO Marc Friedman and CMO Odette Sahakian, staffing 10 employees, including six advisors. According to Hightower, the group works with high-net-worth individuals and families, with an emphasis on entrepreneurs and executives and a particular focus on affluent women. The firm offers portfolio management, financial, retirement and estate planning, and insurance consulting as well as advice in charitable giving.
“We chose Hightower because everything about the firm—from its technology and compliance services to investment ideas, trust services and digital marketing support—is geared towards helping us grow our business,” Powers said.
With Hightower’s investment, ISG will be able to access Hightower’s business acceleration services, infrastructure and middle- and back-office services as it makes a more pronounced push into Colorado, the West and throughout the nation through both organic and inorganic growth. No further details on the investment were provided.
In an interview with WealthManagement.com, Oros said Hightower had been connected with Investment Security Group through Hightower’s internal M&A team, which will typically reach out to RIAs to confer with them about strategic options.
“And then, over the course of the last few months, as we got to know their business and strategy and saw what they were looking for in a potential partner, we got more excited about the business,” Oros said.
Though Oros noted that Hightower isn’t driven by geography when engaging in M&A, the combination of Investment Security Group’s team along with the fact that it was located in a region where Hightower does not have much presence made it an attractive deal. Oros said that there was population growth throughout the Rocky Mountains, and Denver and its surrounding suburbs in particular, due to the lifestyle it offers, and with the influx of people came more businesses and a more robust labor pool.
“As we expand and need to have people, we think it’s a talent-rich market, and there are plenty of advisors,” Oros said. “And we think as other advisors have succession needs, we can use this as an anchor to further grow it that way.”
Hightower, which has about $101 billion in assets under management, is based in Chicago and operates as a registered investment advisor. The firm works with 116 advisory businesses across 34 states and Washington, D.C., offering business consulting, leadership development, marketing and tech support, as well as resources for firms to meet compliance, accounting and payroll obligations, among other services. When growing inorganically, Hightower offers its firms M&A sourcing, as well as deal structuring, due diligence and legal and regulatory resources.
Last month, Hightower purchased Farr, Miller & Washington, a Washintgton, D.C.–based RIA headed by CEO and President Michael Farr; the firm had approximately $2 billion in managed assets (and pushed Hightower above $100 billion in AUM), with additional offices in Devon, Pa., and Naples, Fla.
Shortly after the start of the new year, Hightower made its most sizable acquisition ever by purchasing Bel Air Investment Advisors, a Los Angeles–based RIA with $8 billion in managed client assets. The firm, which had 43 employees, including 10 advisors, was owned by Fiera Capital Corporation, a publicly traded investment management firm based in Montreal.