Clearstead Advisors, a Cleveland, Ohio-based registered investment advisor serving high-net-worth and institutional clients, has acquired Avalon Trust, a wealth management firm based in Santa Fe, N.M., with additional offices in Ridgewood, N.J., and Portland, Ore. The acquisition adds to Clearstead’s trust capabilities, and represents its second deal since private equity firm Flexpoint Ford invested in the RIA in February 2022.
Clearstead initially got into the trust business when it acquired Atlantic Trust in 2021, which has since been rebranded as Clearstead Trust.
Terms of the deal were not disclosed, but Avalon and Clearstead Trust are operating as wholly owned subsidiaries of the firm. Avalon will retain its current branding in the near term, with a Clearstead callout.
The firm currently lacks a national trust charter, limiting those services to the geographies in which its companies are chartered. But Clearstead CEO Dave Fulton said he expects to continue building out the offering over time.
“We haven’t really developed a cogent strategy around that yet,” he said, “But we consider it a really nice business.”
Avalon adds $2 billion to Clearstead, bringing its total client assets to approximately $28 billion. Clearstead provides clients and multi-generational families with a comprehensive suite of services, including wealth management, trust, tax planning, alternative investments and family office administration.
Avalon offers customized investment management, trust, family office administration and financial planning services to individuals, families, trusts, non-profits and foundations. Comprising 13 employees, the firm is managed by Andrew Wallerstein, Christine McDermott and Julia Peters, all of whom will continue as partners and senior leaders under Clearstead. The deal will give the team access to a 21-person tax division, alternative investments and other complementary services at Clearstead.
“Partnering with Clearstead helps us expand our resources and strengthen services for our clients,” Wallerstein said in a statement. “By joining Clearstead, our next generation of team members will have more opportunities to grow and ensure we are able to work with our clients for many years to come.”
The eighth acquisition in Clearstead’s 34-year history, Avalon expands the firm’s presence in the Southwest.
As the firm continues to grow with private equity support, Fulton said more M&A announcements are to be expected but declined to share any details, other than noting a focus on the larger Cleveland area, where the firm is headquartered, and certain other attractive national markets.
“We’re not just buying anything,” he said. “We’re buying high-quality, independent wealth management firms where the owners want to become partners with us in building a larger firm.”
The deal furthers Clearstead’s goal to provide “high net worth families across the United States a holistic and differentiated wealth management offering,” he said. “In particular, Avalon’s focus on client values aligns with our Sustainable Clearstead initiatives.”
The firm’s sustainable initiatives include exclusionary, integration, thematic and market rate impact investing options, based on research and testing. Those are offered alongside education, goals alignment and actionable investment strategies.
With more than 130 employees, nearly two-thirds of whom are partners at the firm, Clearstead is growing consistently at an organic rate of around 10%, more than twice the industry average.
District Capital Partners served as financial advisor to Clearstead on the transaction, while Colchester Partners advised Avalon on the deal.