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AssetMark to Acquire $9.5B Adhesion Wealth

AssetMark is acquiring the platform from Vestmark, bringing its unified managed account and model marketplace capabilities to the publicly traded TAMP.

Turnkey asset management platform AssetMark is adding to its services with the acquisition of Adhesion Wealth, a unified managed account platform.

AssetMark announced the acquisition this week after reaching a deal with Vestmark, which bought Adhesion in 2018. Adhesion, with $9.5 billion in assets as of the end of 2021, currently works with more than 2,800 fee-based advisors at 180 different registered investment advisors, and its services include outsourced overlay trading services, client engagement tech and unified managed account strategies. The company also has a model marketplace.

“As advisors accelerate their growth by increasing the services they provide clients, the addition of Adhesion Wealth further strengthens our ability to serve the rapidly expanding RIA market with an ecosystem of flexible, purpose-built solutions that drive growth, efficiency and scale,” AssetMark CEO Natalie Wolfsen said in a statement. 

“Most TAMPs are enabled with technological infrastructure that can seamlessly integrate with a wide array of service providers, distribution networks, custodians and asset managers, which make them attractive acquisition targets for not only the larger TAMPs, but also for firms across the financial services industry who either want to expand into the wealth-management space or need a comprehensive streamlined platform for their advisors, reps and/or agents,” said ECHELON Partners, which advised Adhesion and Vestmark on this deal, in a statement. “Thus, we expect the currently ramped-up level of deal activity in this space to maintain throughout upcoming periods.”

RIA clients on AssetMark’s platform will gain access to Adhesion’s technology as a result of the deal. Broker/dealer advisors on the AssetMark platform will gain access to a number of services via Adhesion, including personal and direct indexing, tax management, portfolio administration and client reporting, according to an AssetMark spokesperson.

Adhesion claims it has the industry's second largest model marketplace, with more than 400 asset managers and strategists onboard. Both AssetMark and Adhesion, which had been a Vestmark client for 10 years prior to its 2018 acquisition, will continue to use Vestmark’s tech in support of their own platforms. 

In his own statement about the deal, Adhesion President Barrett Ayers said the firm has aimed to support independent advisors focused on growth since its inception.

“Joining AssetMark allows us to continue our mission and impact a broader group of advisors, while also giving us the ability to bolster our service offering and advance our investments in new capabilities to serve our existing advisors,” he said.

The deal is expected to close in the second half of the year.

Broadhaven Capital Partners is advising AssetMark. The publicly traded company, which was founded in 1996, operates its platform through an SEC-registered investment advisor subsidiary, and had about $90.8 billion in platform assets as of the end of March. More than 8,500 advisors use its platform.

In February, AssetMark announced several additional tools for advisors, including WealthBuilder Prospecting, which was created to provide “a gateway for interested leads to start a low-friction discovery process,” as well as Marketing Advantage, a marketing platform that includes a client-facing content library of posts, articles and visuals.

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