Cetera Financial Group, part of RCS Capital (RCAP), is set to wind down its internal due diligence group. Instead, these operations — involving the review of alternative investments, mutual funds and advisory programs — will be handled by SK Research, which also is owned by RCS Capital, next year.
The news comes as the company's stock price languishes at around $1.20. Its shares weakened recently after it revealed plans to sell its troubled wholesale distribution unit to Apollo Global Management (APO) for $25 million and form AR Global Investments, set to be owned 60% by Apollo and 40% by RCAP.
"As part of our ongoing efforts to provide industry-leading resources to our advisors, we have restructured our due diligence capabilities to fully leverage our highly regarded sister firm, SK Research, … widely recognized for [its] quality research and proven due diligence expertise in the alternative space," according to a spokesperson.
Cetera Financial intends to continue to review insurance products, provide overlay management of the SK diligence process and make decisions regarding product approval.
