Saturday, March 1, 2014

Broadridge Financial Acquires Advisor Publishing Firm Emerald for $60 Million

Broadridge Financial Solutions (BR) announced Wednesday that it had agreed to purchase Emerald Connect LLC for $60 million in cash from StoneRiver Group (the former Fiserv Insurance Solutions company), which is owned by Fiserv Inc. and the private equity firm Stone Point Capital.

Emerald, founded in 1986 as a seminar marketing firm by Craig Faulkner, who now runs Faulkner Publishing, has built its seminar business over the years into providing print newsletter services and additional marketing tools for advisors, including websites, seminars, email and direct mail services and social media.

Emerald will be integrated into Broadridge’s Forefield operations, which creates compliance-approved content similar to Emerald.

In a statement, Broadridge’s president for Investor Communication Solutions (ICS), Robert Schifellite, said the Emerald-Forefield offerings will take advantage of the growth in independent advisors to  “reach nearly 100,000 advisors” and will allow Broadridge to “deliver additional practice management and productivity tools to these financial professionals.”

In December 2010, Broadridge acquired Forefield, a Worcester, Mass.-based firm founded by Ronald Newton and led by longtime CEO Brent Delehey and President Bill Davenport. Broadridge paid $19.6 million for Forefield. Davenport remains the general manager of Forefield, and James Walsh continues to run its editorial operations.

At the time of its 2010 acquisition by Broadridge, we wrote that “Forefield’s expertise is typified by James Walsh, JD, its editor-in-chief," who has written about topics like the alternative minimum tax (AMT) for Investment Advisor.

Broadridge itself, based in Lake Success, N.Y., provides a range of outsourcing services to broker-dealers, banks, mutual funds and corporate issuers worldwide, including securities processing, proxy voting and data aggregation.

Andrew Besheer, president for Customer Communications, a unit within Broadridge’s ICS division, will run the consolidated businesses. Emerald has offices in San Diego and Duluth, Minn., and employs more than 120 people. 

On Feb. 6, Broadridge reported a 75% jump in net earnings to $28 million for the second quarter of its 2014 fiscal year ended Dec. 31, 2013, on a 6% increase in total revenues to $521 million (compared to the same period in the prior year). diluted earnings per share for the quarter increased 69% to $0.22 per share from $0.13 per share for 2013’s Q2. Revenues for its ICS division, where Emerald (and Forefield) will be placed, rose 6% to $346 million in the quarter. 

Commenting on the results at the time, Richard Daly, Broadridge’s president and CEO, said, “Our first six months’ financial performance has also enabled us to accelerate strategic investments to be made this year into our solutions related to the  three key macro trends that Broadridge is uniquely positioned to address: the digitalization of investor communications; cost/capability mutualization; and intelligence created from our unique data.” 

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