Blucora to Acquire 1st Global

Two tax-focused independent broker-dealers (IBD) are coming together. Blucora, the parent company of the IBD HD Vest and the software maker TaxAct, have entered into an agreement to buy 1st Global for about $180 million in stock. Both are based in the Dallas-Fort Worth area.

With 1st Global’s 850 advisors and $18 billion in client assets, the combined entity should have close to 4,500 advisors and $60 billion in total assets, Blucora says. 1st Global, the No. 2 tax-focused independent broker-dealer based on total revenue, specializes in servicing large, multi-partner accounting firms, while HD Vest, the No. 1 tax-focused independent broker-dealer, focuses primarily on converting individual tax preparers into wealth advisors.

Tony Batman, chairman and CEO of 1st Global, says, “Given Blucora’s strong business model and demonstrated execution, and the similarities between the businesses, we believe Blucora is the ideal acquirer for us. We know that Blucora shares our vision and that together we are better and stronger with the shared talent and expertise of the two businesses. This will provide our advisors and their clients with even greater service, support and solutions for years to come.”

The deal comes more than three years after Blucora announced plans to buy HD Vest, which had 4,500 financial advisors with $36 billion in assets at the time.

“Blucora dominates the tax preparer/advisor market space, [and] they further increase their dominance with the purchase of 1st Global,” says IBD recruiter Jon Henschen. “1st Global was originally a spin-off from HD Vest, with Tony Batman founding the firm with the same focus of tax preparers as HD Vest but focusing on having higher average-production-per-advisor requirements than HD Vest.”

Recently, 1st Global released the results of its advisor satisfaction survey, which found that more than 97% are pleased with service and support and would recommend affiliating with 1st Global to another financial advisor or CPA.