A chance encounter on a trip to the beach helped kindle the deal between a downtown financial firm and a buyer in North Carolina.
Richmond-based Thompson Davis & Co. merged with Zermatt Wealth Partners of Raleigh, N.C. in a deal that closed Aug. 1.
Bill Davis, Thompson Davis’ founder and CEO, said Zermatt founder Louis Dworsky acquired a 50 percent stake in the firm. Further financial specifics of the deal were not disclosed by either side.
The transaction brings together Thompson Davis’ investment management skills with Zermatt’s wealth- and estate-planning services. Davis founded his firm in Richmond 12 years ago, and Dworsky started Zermatt about a year ago after leaving Morgan Stanley.
“It definitely expands our offerings on both sides,” said Davis, 48. “What (Dworsky) provides, we didn’t really have a lot of that expertise in house. From his standpoint, having a proprietary asset management arm in house was important.”
The combined firms have $275 million in assets under management, the vast majority of which came over with Thompson Davis. It has 18 employees, including 12 in Richmond at Thompson Davis’ headquarters at 15 S. 5th St.
In addition to Raleigh and Richmond, the combined firms have offices in Charlottesville, Sarasota, Fla. and have plans for expansion. Greensboro, N.C. is nearest on the firm’s radar at the moment, and Atlanta is another market on the list.
Dworsky said joining forces with Thompson Davis is the first step to create what he called a “high-end wealth management boutique for the Southeast.”
“The intention with Zermatt is to grow a franchise from Richmond to Atlanta and then head west,” he said.
The Thompson Davis brand will remain in use in Richmond and the other markets where it operates. The Zermatt name, named for a ski town in Switzerland Dworsky once visited, will still be used in North Carolina and will be used in any new markets the firm enters.
Davis and Dworsky will be co-CEOs. Davis, a graduate of Virginia Tech who started his career at former Richmond firm Branch Cabell, will run the company’s asset management operations. Dworsky will oversee the financial planning and estate planning business.
“He’s doing more comprehensive financial planning and asset allocation,” Davis said. “I’m finding the stocks, and buying and selling stocks on behalf of the client.”
The deal came about after Thompson Davis partner Read Northen ran into Dworsky on a trip to North Carolina. The two had known each other previously, and the rendezvous got Dworsky interested in Thompson Davis.
“At first I was not interested in selling any of our firm,” Davis said.
But Dworsky made a formal offer around Thanksgiving, and Davis took it to the Thompson Davis board to consider. Negotiations got more serious in the spring, culminating in the closure earlier this month.
Davis said he realized he could grow the firm faster with Zermatt’s expertise.
“It allowed both sides to get further down the field, so to speak, on very similar plans,” Davis said.