Securian Financial Group buys H. Beck

Another independent-contractor broker-dealer is being sold — and this time an insurance company is pulling the trigger on the deal.
SEP 10, 2008
Another independent-contractor broker-dealer is being sold — and this time an insurance company is pulling the trigger on the deal. This morning, insurance company Securian Financial Group Inc. announced that it will purchase Capital Financial Group Inc. and its broker-dealer, H. Beck Inc. Terms of the deal were not disclosed. The firms will be independently operated, the companies said in a statement, and no layoffs are expected. Today’s move by Securian goes against current market common wisdom, which holds that more insurance companies will get out of the brokerage business. Insurance companies were big buyers of independent broker-dealers about a decade ago, but some have recently left the business. Most notably, in March 2007, Pacific Life Co. of Newport Beach, Calif. sold three of its broker-dealers to LPL Financial of Boston. There has been a plethora of deals for broker-dealers this summer. Last week, a group of investors led by John Sykes, the founder of Sykes Enterprise Inc. of Tampa, Fla., said it was acquiring GunnAllen Financial Inc. of Tampa. Securian Financial of St. Paul, Minn., already has a presence in the independent broker-dealer market: It’s the parent company of independent broker-dealer Securian Financial Services Inc., with 1,220 affiliated advisers. Last year, Securian had $118 million in gross revenue and $12.2 billion in client assets. Capital Financial/H. Beck has about 750 affiliated reps and reported $80 million in gross revenue. It has client assets of $7.8 billion. The transaction is expected to close by the end of the year.

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