Advisor Group buying Ladenburg Thalmann, creating giant IBD

Advisor Group buying Ladenburg Thalmann, creating giant IBD
The combined companies will be home to nine broker-dealers, over $450 billion in assets and nearly 11,500 advisers.
NOV 11, 2019
Advisor Group is acquiring Ladenburg Thalmann Financial Services Inc., creating one of the largest independent broker-dealers in the country, the companies announced Monday. With more than 4,000 advisers across five broker-dealers, Ladenburg Thalmann has been in discussion with potential buyers for several weeks. Under terms of the cash deal, each share of Ladenburg's common stock will be converted into a cash payment of $3.50 a share. The total enterprise value of the deal is about $1.3 billion. [Recommended video: CEO Walt Bettinger lays out Schwab's plan with zero commission trading] The combination of the two broker-dealer networks would create a giant firm with more than $450 billion in assets under management, $3 billion in annual revenues and nearly 11,500 advisers. Ladenburg Thalmann, whose stock has climbed from $1.98 to $2.92 per share since news leaked out that it was for sale, first began building its network of independent broker-dealers in 2007 when it bought Investacorp Inc. Since then, it has bought Triad Advisors Inc., Securities America, Securities Service Network Inc. and KMS Financial Services Inc. Those firms had close to 4,400 advisers at the end of last year and reported $1.38 billion in total revenue at the end of 2018, according to InvestmentNews data. Advisor Group has four broker-dealers in its network: FSC Securities Corp., Royal Alliance Associates Inc., SagePoint Financial Inc. and Woodbury Financial. According to InvestmentNews data, the four combined to produce $1.7 billion in total revenue last year. They house some 6,500 producing financial advisers and registered reps. Private-equity manager Reverence Capital Partners earlier this year bought 75% of Advisor Group from Lightyear Capital, PSP Investments and other investors.

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