Berger Financial Group, a Minnesota-based registered investment advisor with more than $3 billion in assets under management, has sold a majority stake to the Bahrain-based alternative investment giant Investcorp, in a move that will establish a beachhead for further acquisitions, the firms announced.
Berger, founded in 1981, has grown both organically and through acquisitions to serve more than 3,800 clients across nine offices. The firm, which provides financial and retirement planning, tax planning and portfolio management services, had been owned by senior leaders and employees through a stock program, according to its most recent Form ADV. That management team, including CEO Nick Asmus, and about 30 financial advisors, will maintain a “significant” stake in the firm alongside Investcorp, according to the announcement.
The investment is the culmination of a multi-year pursuit by Bahrain-based Investcorp of a North American wealth manager that it could continue to grow, according to the firm. The alternatives manager said its interest in the wealth space is driven by aging demographics, generational wealth transfer, rising financial complexity and client migration toward fee-based fiduciary advice.
“Berger is exactly the kind of platform we look to back: a differentiated, fee-based wealth management business with exceptional client and advisor retention and significant runway for value creation in a large, fragmented market,” Vitali Bourchtein, managing director on Investcorp’s North America private equity team, said in a statement.
The investment is not an alternative-distribution-channel play, according to an Investcorp spokesperson, partly because “alternatives are not a big focus for Berger’s clients.”
Investcorp will get a seat on Berger’s board, while current leadership will continue to run “day-to-day” operations, according to a spokesperson.
Asmus said in a statement that the firm is excited to work with Investcorp in its next phase of growth.
“Investcorp has demonstrated deep knowledge of our sector, and we are confident in the partnership’s ability to increase Berger’s market positioning and scale potential in the coming years,” he said.
Berger had been with independent broker/dealer Cambridge Investment Research before jumping to the RIA side in 2020.
Investcorp has a history of investing in specialized business and professional services firms, including accounting and advisory firm PKF O’Connor Davies, consulting firm AlixPartners, and talent and entertainment company United Talent Agency. The firm’s North America Private Equity group has completed more than 79 transactions, deploying more than $25 billion in transaction value since inception.