Wells Fargo Sells H.D. Vest To Private Equity Firm Parthenon

Friday, July 01, 2011 06:36
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Wells Fargo Sells H.D. Vest To Private Equity Firm Parthenon

Tags: M&A

Non-"distressed" brokerage firms are still finding plenty of buying interest on the open market, as Wells Fargo's recent divestiture of H.D. Vest shows.

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Wells Fargo was only rumored to be shopping the accountant-oriented operation around six weeks ago, but private equity firm Parthenon Capital Partners has already stepped up to buy.

 

Since the rumors started, a few interesting details have emerged.

 

First, about 400 advisors on the H.D. Vest roster went away, leaving a still-robust 4,800 advisors -- primarily tax prep professionals -- behind. Whether that's due to the looming sale or normal attrition remains to be seen.

 

Second, now that H.D. Vest has released its 2010 numbers, we can see that it shed $31 million in book value last year, so Parthenon is getting assets worth around $142 million in this deal.

 

Most of that valuation is still accounted for as "goodwill."

 

Finally, this deal only took six weeks from rumor to close while Ameriprise has been shopping Securities America around since late April.

 

Granted, Securities America is technically a distressed asset whereas H.D. Vest has no legal problems beyond not playing into Wells Fargo's overall strategy.

 

In an industry full of troubled brokerage firms, is that the difference between those who can find eager buyers and those who have to wait?

 

 

 

 

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