The spate of bank acquisitions of money managers announced this week demonstrates the continued appeal of adding investment clients in single swoops.

Wilmington Trust Corp. said Tuesday that it will take a 24% stake in Cramer Rosenthal McGlynn, a New York firm with $3.6 billion of assets under management, primarily for affluent people.

Also Tuesday, First Tennessee National Corp., Memphis, announced it intends to acquire Martin & Co., an investment firm in Knoxville, Tenn. The $925 million under management there would lift First Tennessee over the $3 billion mark.

And People's Bank, Bridgeport, Conn., said it plans to acquire Olson Mobeck & Associates Inc., an investment firm in Litchfield and Rocky Hill, Conn., with $850 million of assets under management.

"The industry is beginning to recognize the high-net-worth market segment as a distinct and valuable franchise," said Peter L. Bain, a principal of Berkshire Capital Corp.

The New York investment bank represented Cramer Rosenthal as well as People's.

All three deals are expected to close before yearend. Their terms were are not disclosed.

Such transactions are currently priced at 10 to 12 times the firms' cash flow, according to an investment banker involved in similar deals. Typically, that means a price equivalent to 2% to 3% of assets under management.

For banks, that seems to be money well spent. When wooing wealthy prospects, bankers say, having more than $1 billion under management helps marketing efforts.

That kind of heft also buoys the cost-efficiency of being in the private asset management business.

"We feel that's an important threshold. It's a combination of those two," said Humphrey Nichols, manager of trust and investment services at People's.

"People want to make sure you have the depth of expertise," he added. "That's where I'm suggesting, if you exceed the $1 billion threshold, it receives greater attention."

Wilmington opts not to take majority ownership in investment firms. Last year it bought the same percentage of another New York firm, Clemente Capital. The Delaware-based banking company, which administers $100 billion of assets, plans to open an office adjacent to that of Cramer Rosenthal.

"What you are seeing is that even fantastically successful banks like Wilmington Trust are trying to find ways to get involved in the high-net- worth market," said an investment banker, who requested anonymity.

"It has a great name in personal and institutional trust. You'd think it would be able to hand out its calling card to wealthy people," he added. "It's not that easy because every bank in the world is going after wealthy families" for investment management.

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