A 30-Year-Old Asset Manager Kicks the Tires on M&A
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Tuesday, January 02, 2018

A 30-Year-Old Asset Manager Kicks the Tires on M&A

A freshly rebranded, 30-year-old asset manager may soon be acquiring.

"We're talking to firms with anywhere from $500 million to $5 billion [in AUM]," David Rentfrow, managing director and head of distribution at Crossmark Global Investments [profile], tells MFWire. "And there's nothing to prevent us from having conversations with firms larger than ours."

Houston-based Crossmark, which has about $5 billion in AUM and about 50 people, was known as Capstone Financial Services before rebranding last August. Rentfrow says that Crossmark is open to doing liftouts and is "kicking the tires" on some possible acquisitions targets. There is "one consistency" across the different boutiques and teams they're looking at, Rentfrow says.

"They essentially don't have a distribution apparatus themselves," Rentfrow adds. "The opportunity for them is to piggyback on our operational foundation as well as our distribution capabilities to grow."

"Geography doesn't matter" when it comes to M&A, Rentfrow says, though the Crossmark team is especially interested in developing a footprint in one of the big money center cities like Atlanta, Boston, Charlotte, Chicago, New York, or San Francisco.

"It's all designed to get us closer to our goal of $30 billion of AUM by 2030," Rentfrow says. "Our intent is to still do that both organically and inorganically through acquisitions."

Crossmark is 100-percent owned by AG Financial Solutions, a non-profit that serves as the financial services arm of the Assemblies of God Church and specializes in church business loans. AG also does bank loans, insurance services, and retirement plans, and Crossmark (back in the Capstone days) originally created its Steward Funds mutual fund family for AG's 403(b) business.

"For us AG Financial as an owner has been perfect," Rentfrow says, adding that the non-profit is "willing to invest in both organic and inorganic growth."

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