Modera Wealth Management, a fee-only registered investment advisor headquartered in Westwood, N.J., has acquired Parsec Financial, a fee-only RIA based in Asheville, N.C. Parsec adds about $3.8 billion in assets under management and six North Carolina offices to Modera, raising the firm’s assets to $10.5 billion and creating one of the largest RIAs on the East Coast.
The combined firm has more than 180 employees and 14 offices from Massachusetts to Florida. Both were founded in the mid-1980s as two of the first fiduciary, fee-only firms in the nation. Modera launched in 1983, the same year the National Association of Personal Financial Advisors was established.
“Modera and Parsec have long shared a common set of core values that differentiate us from other wealth management firms,” Modera CEO Tom Orecchio said in a statement. “We believe that the increased scale, resources and talent resulting from the combination of our firms will serve to enhance that commitment as we continue to elevate the depth and sophistication of our services.”
Modera sold a minority stake in the firm to Tria Capital Partners, a financier of RIA M&A and succession planning that is run by former Fiduciary Network partners, in 2021, but remains majority owned and controlled by the firm’s employees. All of Parsec’s approximately 75 employees have joined Modera and 24 have become owners, bringing the RIA’s total employee owners to 61.
“It’s very rare for a firm the size of Parsec to sell to a firm that’s not much bigger than themselves,” said John Eubanks, managing director at Park Sutton Advisors. An investment bank and financial services consulting firm owned by Waller Helms, Park Sutton advised Parsec on the transaction.
Eubanks said his client went through the process of looking at larger acquirers but ultimately decided to join Modera “because it was more transformational, and they felt they would still have a major say in the future of the combined firm.”
Both firms agreed to treat the transaction as a merger, Eubanks said, predicting the RIA M&A space will see an increasing number of these types of deals as the field continues to consolidate.
In early 2021, Modera completed a similar transaction when it bought Independence Advisors with $1.3 billion in assets, bringing the combined firms to $4.4 billion.
“We position a lot of our transactions as mergers as our goal is not to just buy the firm and swallow them; our goal is to partner and have the owners become owners of our firm,” Orecchio said at the time.
“Our two firms have succeeded thus far in large part because we share the same mission: to deliver sophisticated, fee-only wealth management in a highly personal way,” said former Parsec CEO Rick Manske. “Now, we have the unique opportunity to join forces and do that same work together as one stronger organization. We believe that will benefit our clients while also creating a path for next-generation leaders to steward the firm for many years to come.”
At Modera, Manske has become chief growth officer; Parsec CIO Bill Hansen is now co-CIO; and Parsec COO Harli Palme remains in that position. Manske and Palme have also joined Modera’s board of directors.
The transaction closed on Tuesday, April 25. Terms were not disclosed.