Welcome to Financial Advisor IQ

Emigrant Bank Acquires Remaining 25% of Fiduciary Network

November 27, 2018

The Dallas-based RIA consolidator Fiduciary Network will become fully owned by Emigrant Bank, according to news reports.

Emigrant is acquiring the remaining 25% that it didn’t already own from Fiduciary Network’s management team, including CEO Mark Hurley, who founded the firm in 2007, according to InvestmentNews. Karl Heckenberg, one of the members of Fiduciary Network’s board of directors, is taking over the reins, the publication writes. The companies didn’t disclose the terms of the deal, according to InvestmentNews.

Reports emerged in July that Fiduciary Network was seeking a buyer, but both companies remained mum at the time.

The operating agreement between the two firms stipulated Emigrant had a right of first refusal to acquire the remaining 25% stake or sell its existing 75% stake to an outside buyer, InvestmentNews writes. Emigrant opted to buy because of its faith in the prospects of the Fiduciary Network as well as its affiliates, Heckenberg tells the publication in an email.

"You could say we put our money where our mouth is,” he writes, according to InvestmentNews.

Fiduciary Network, which has 17 member firms that oversee $40 billion, hasn’t been actively acquiring recently, while Hurley “has been at odds” with executives at Emigrant, the publication writes. Meanwhile, Emigrant has invested $155 million in the member firms already, according to Silver Lane Advisors, which facilitated the deal, InvestmentNews writes.

The bank wants to invest even further, and taking sole ownership will make that easier, Liz Nesvold, a managing partner at Silver Lane, tells the publication. Nonetheless, Nesvold also says Emigrant isn’t “a ’control’ partner that wants to get in people’s knitting," according to InvestmentNews.

Fiduciary Network did not respond to the publication’s request for comment.

By Alex Padalka
  • To read the InvestmentNews article cited in this story, click here.