Advisor Deal Activity Could Drop 20% This Year: Echelon

Still, the investment firm and consultancy points out, "deal volume started to rebound at the end of Q2 with 15 transactions announced in June," which means the year-end total might exceed projections.

"The spread of COVID-19, which shocked capital markets and the broader economy in March and April, caused a slowdown in the deal process for many. A number of deals that were expected to be finalized in Q2 were delayed and are now on pace to be completed in Q3," it added.

Deal Size

The transaction size in the RIA M&A space is at "historically high levels, with 16 firms that have more than $1 billion [in assets] involved in the quarter's 35 transactions," according to Echelon.

Overall, the average asset level of the acquired firms to date in 2020 surpassed $1.5 billion, which is "an all-time high," the group says.

Some of this quarter's biggest transactions were private equity firm GTCR's investment, representing a 25% minority stake, in Captrust Financial Advisors. As of March 31, Captrust had roughly 700 employees, some $18 billion in wealth management assets and $390 billion in assets under advisement.

Another large deal announced recently was the merger of Orion Advisor Services and Brinker Capital. The combined entity has some $40 billion in assets under management.