Monday, July 22, 2024

Coldstream, Arnerich Massena Merge to Create $10B RIA

Coldstream, Arnerich Massena Merge to Create B RIA

Seattle-based registered investment advisor Coldstream Wealth Management has merged with Arnerich Massena, a Portland, Ore.-based RIA with about $2 billion in assets under management. Once the deal closes, Coldstream will have $10 billion in client assets.

Arnerich Massena will operate as Team Rae, and all 19 employees, including seven advisors, will become shareholders of Coldstream. Including this transaction, Coldstream has nearly doubled in size over the last three years without taking any outside capital.

“That’s not been some kind of ambitious growth plan to hit some number by some date because some spreadsheet told us to do it from some PE [private equity] firm,” said Kevin Fitzwilson, Coldstream’s managing shareholder. “It’s been more so finding like-minded partners. The market’s been pretty good—outside of ’22—for that.”

“We’re taking that path less traveled of staying truly independent—not taking any outside capital.”

Founded in 1991, Arnerich Massena is an employee-owned firm, led by co-CEOs Reegan Rae and Bryan Shipley, both of which will take on key leadership roles at Coldstream. The firm provides portfolio management, investment advisory and family-office services, such as legacy planning, business exit planning, family governance and generational wealth planning. It has an endowments and foundations practice, and Shipley will lead that combined business line within Coldstream.

“Arnerich Massena has a proud history and a unique set of values, so the decision to combine with another firm didn’t come lightly, nor was it something that happened overnight,” Rae said in a statement. “Yet, after getting to know Kevin and the other members of Coldstream’s leadership team, it became clear that our two firms share a common operating structure, business vision and, importantly, a focus on culture rooted in service, intellectual curiosity, and integrity.” 

Rae said her firm was attracted to Coldstream for its additional services, including tax preparation, property and casualty insurance, investment options, and career opportunities it offered her staff. She was also impressed with the RIA’s ability to grow and offer equity ownership without private equity capital.

“Coldstream is kind of this diamond in the rough in terms of their model and the fact that they can hang with not only the publicly traded organizations that are out there but also the private equity-backed groups,” she said. 

This latest deal builds on Coldstream’s northwest expansion as it looks to build partnerships throughout the West. The firm aims to grow top-line revenue by 20% annually, half through mergers and acquisitions and half organically.

In 2021, the firm merged with Mercer Island, Wash.–based Paracle Advisors, an RIA with about $1.4 billion in client assets. Following that, the firm combined with Rosenbaum Financial, another Portland-based firm, in 2021. Last fall, Coldstream merged with Seidman Capital Group, a wealth management firm, and Hersman Serles Almond, which provides accounting and consulting services. The two Kirkland, Wash.-based affiliated businesses were founded by Hersman Managing Partner Victoria Serles.

Last year, Coldstream brought in Matt Sonnen as chief operating officer to help with the identification, onboarding and integration of new firms.

Established in 1996, Coldstream was partially owned by Boston Private for about a decade before management made the decision to buy out the bank in 2011.

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