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For small B-Ds, becoming part of a branch office of a larger firm is a viable exit strategy

15:45 26 August in In the News by rafferty

August 25, 2017 By Bruce Kelly, Investment News Such deals allow them to get out from under the cost of running a broker-dealer, but preserves their brand and culture LPL Financial's acquisition this month of the National Planning Holdings Inc. network of four broker-dealers with 3,200 reps and advisers certainly has the independent broker-dealer industry abuzz, but transactions involving smaller broker-dealers are also of keen interest, as well as far more common. ​ At the start of the year, brokerage executives pointed to the potential for large firms buying small firms, which are struggling with compliance and technology costs, and absorbing them as branches called offices of supervisory jurisdiction, or OSJs. Two recent deals or mergers stand out. Royal Securities Co. of Grandville, Mich., a 17-person broker-dealer managing $1.1 billion in assets, in July said it...

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Is LPL’s Purchase of NPH Savvy or Reckless?

21:05 16 August in In the News by rafferty

August 16, 2017 By Janet Levaux, ThinkAdvisor Analysts and executives discuss the pros and cons of the IBD's $325 million purchase LPL Financial announced the much-anticipated purchase of National Planning Holdings, an affiliate of Jackson National Life, and its four broker-dealers late Tuesday. Early Wednesday, CEO and President Dan Arnold and CFO Matt Audette spoke with equity analysts about the news and highlighted details of what could be a profitable but also highly complex merger. Here are some of the issues raised during the discussion, with input from some analysts on the call and insights from outside industry sources, pointing to potential benefits and pitfalls of the transaction. The Price Tag At $325 million initially and with a possible contingency payment of up to $123 million, Arnold says the independent broker-dealer is paying “a price that is...

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LPL Pays $325 Million for Jackson National B/Ds

17:12 16 August in In the News by rafferty

August 15, 2017 By Diana Britton, Michael Thrasher, WealthManagement.com The deal brings another 3,200 advisors to the nation’s largest independent broker/dealer, and it’s the latest in a trend of insurance firms exiting the b/d business. The U.S.’s largest independent broker/dealer just got bigger. LPL Financial announced Tuesday it had acquired National Planning Holdings, the network of broker/dealers affiliated with Jackson National Life Insurance Company, from Prudential, for $325 million. The deal will add 3,200 advisors to LPL’s network. The deal is the latest example of an insurance company shredding a brokerage business. Last week, independent b/d Kestra Financial entered an agreement to acquire H. Beck, a firm owned by insurance company Securian Financial Group, adding about 600 advisors and $2.4 billion in client assets to Kestra’s platform. The rationale for these hookups—creating an easy distribution...