Recent Deal Making Raises Question: What is Wells Fargo Advisors Worth?

Posted on September 30th, 2021 at 12:32 PM
Recent Deal Making Raises Question: What is Wells Fargo Advisors Worth?


From the Desk of Jim Eccleston at Eccleston Law:

Deal-making in the wealth management industry continued this week as The Tiedemann Group and Alvarium Investments have agreed to merge with Cartesian Growth Corp. to create a new firm. 

However, the company will be listed on Nasdaq as Cartesian due to its status as a special purpose acquisition company (SPAC). The SPAC, which has been tabbed as a faster and cheaper alternative to the IPO since the outset of COVID-19, will enable the newly created firm to oversee $54 billion in client assets. 

The agreement begs the question of how much Wells Fargo Advisors could potentially be worth on the market. One must consider the currently heightened demand for wealth manages as well as Sen. Elizabeth Warren’s recent proposal that the Federal Reserve break up Wells Fargo. 

Charlie Scharf, Wells Fargo’s new CEO, has already initiated a reorganization of the firm as the company sold its asset management business earlier this year for $2.1 billion. According to bankers and competing executives, a potential sale of Wells Fargo Advisors should generate ample demand on the market from private equity firms and other broker-dealers. Wells Fargo employs 12,819 advisors who earn average annual revenue of $1.08 million, which equates to $13.8 billion in annual revenue for the wealth management business. Wells Fargo Advisors earns annual pre-tax profits of $2.76 billion if 20% margins are assumed. Add on a valuation of eight times EBITDA, which provides that Wells Fargo Advisors may be worth $22.1 billion or more. 

Eccleston Law LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

Tags: eccleston, eccleston law, wells fargo

Return to Archive

TESTIMONIALS

Previous
Next

I learned two important things working with Eccleston Law. First, I made a friend and ally with Jim and Steph for life. Secondly, and this is a crucial life lesson - if you need counsel, then seek out the very best. Jim was referred to me by a most trusted source. I've never had to hire an attorney for anything. Now, I know the value of hiring an important partner. Meticulous, thorough and detailed in preparation is the best way to describe Jim. Brilliant too, I might add. Bottom line, I would highly highly recommend Jim and Stephany for your legal needs. One of the best life decisions I've ever made.

Howard S.

LATEST NEWS AND ARTICLES

April 25, 2024
B. Riley Financial Clears Air Amid Allegations, Stock Surges

Amidst swirling speculation regarding its connections with a client linked to the Prophecy Asset Management collapse, B. Riley Financial Inc. has conducted an internal
review, concluding no affiliations with the defunct hedge fund.

April 24, 2024
RIA Insurance Claims Skyrocket

A recent analysis by Golsan Scruggs reveals a staggering 231 percent increase in errors-and-omissions (E&O) liability claims among registered investment advisor (RIA)
insurers.

April 23, 2024
Surge Predicted in Regulation Best Interest Cases

According to a recent analysis, Reg BI-related actions quickly have ascended to the top five issues for FINRA, with fines totaling $6 million in 2023.