2022 M&A Action Picks Up Steam With Latest NFP Acquisition

Insurance broker and consultant NFP has announced its acquisition of Improved Funding Techniques Inc. (IFTI). The transaction closed on December 1.

IFTI is a third-party administrator (TPA), with an internal registered investment adviser (RIA), offering a consolidated solution for designing, implementing and administering retirement plans for privately owned businesses. In acquiring IFTI, NFP says it will add scale to its retirement business and expand its footprint in the New York metro area and around the country.

According to the firm, the acquisition is also meant to advance NFP’s existing internal TPA expertise, while adding complementary defined benefit (DB) plan capabilities that can be leveraged across the entire organization.

Nick Della Vedova, president of NFP Retirement, says the acquisition will allow NFP to leverage IFTI’s existing relationships across the region while enhancing its ability to deliver value to businesses of all sizes, including larger manufacturing companies and professional services firms, such as medical and law practices.

Daniel Bystrom, IFTI’s president, will join NFP as a senior vice president reporting to Della Vedova. Bystrom and the IFTI team will collaborate with NFP’s team in the Northeast region on opportunities to introduce solutions across the NFP Retirement distribution network. Commenting on the acquisition, Bystrom says his team of consulting and actuarial experts will complement NFP’s commercial insurance, group benefits and executive benefits solutions.

The transaction comes on the heels of a recent agreement announced by Wealthspire Advisors, an NFP company and independent investment adviser, to acquire Private Ocean LLC, a fiduciary wealth management firm with $2.7 billion in assets.

News of the IFTI deal comes after another record-breaking year for adviser industry merger and acquisition (M&A) activity. According to research by Echelon, the possibility of tax code changes helped industry M&As set a quarterly record in the third quarter of 2021, which saw 78 deals announced. The previous record was 76 deals, set in the first quarter of 2021. The third quarter analysis showed large strategic acquirers, many of which are backed by private equity firms, maintained their status as the most active dealmakers in the wealth management and advisory industry.

Last year, Wise Rhino Group published a new analysis of the rapid M&A activity occurring in the retirement plan advisory industry, finding the pace of deals continued to accelerate throughout 2021. The analysis suggested the same is likely in 2022.

Wise Rhino Group found that insurance brokerage firms such as NFP are arguably the best positioned to integrate retirement advisory firms, as most have established operating companies and have coveted growth currency in the form of employee benefits and property-casualty referrals. They are also the most experienced acquirers and are very effective at integrating new partner firms.