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Advisor Group and Ladenburg Thalmann to merge in USD1.3bn deal


Independent wealth management firm Advisor Group, and Ladenburg Thalmann Financial Services, a publicly-traded diversified financial services company, have agreed to a merger of the two companies.

Under the terms of the transaction, Ladenburg has agreed to be acquired by Advisor Group through a cash merger, in which each outstanding share of Ladenburg’s common stock will be converted into a cash payment of USD3.50 per share. The total enterprise value of the transaction is approximately USD1.3 billion, taking into account Ladenburg’s common stock, preferred stock and outstanding debt. The definitive merger agreement and the transactions contemplated were unanimously approved by Ladenburg’s Board of Directors.

The transaction, which is subject to customary closing conditions, including the approval of Ladenburg’s shareholders, and receipt of required regulatory clearances and approvals, is expected to close in the first half of 2020.

Following the completion of this transaction, the expanded Advisor Group organisation will continue to be led by its current CEO and President, Jamie Price. When the transaction is completed, Advisor Group’s leadership team will include senior executives from both Advisor Group and Ladenburg. Ladenburg’s firms will not be merged with Advisor Group’s firms, reflecting both companies’ commitment to a multi-brand network model.

Advisor Group’s network of firms consists of FSC Securities Corporation, Royal Alliance Associates, SagePoint Financial and Woodbury Financial.  Ladenburg’s independent advisory and brokerage firms include Securities America, Triad Advisors, Investacorp, KMS Financial Services and Securities Service Network (SSN).

Additional Ladenburg subsidiaries include Highland Capital Brokerage, a leading insurance solutions brokerage; Premier Trust, a financial advisor-focused trust services company; and Ladenburg Thalmann & Co, a middle market investment bank. Each of these subsidiaries has played a role in delivering unique, value-add solutions to Ladenburg-affiliated financial advisors.

Ladenburg Thalmann Chairman, President and CEO Richard Lampenm, says: “This is a transaction that maximises value for our shareholders, while positioning our financial advisors for continued growth and success. We have always been impressed with Advisor Group’s platform, offerings and leadership. Advisor Group’s CEO, Jamie Price, and his management team offer a mature shared services model and a demonstrated ability to innovate and invest in ways that help advisors grow. We are confident this transaction will help our advisors accelerate the growth of their businesses, while enabling them to benefit from the highly personalised service experience they have always enjoyed, under a very similar multi-custodial, multi-clearing and multi-brand structure.”

Advisor Group President and CEO Jamie Price, says: “This acquisition brings together the best of two industry leaders, to the benefit of the financial advisors we collectively serve. We believe that the investments necessary for competitively differentiated technology, practice management, products and service excellence require a greater level of scale than either of our companies can achieve on a stand-alone basis.  In fact, as our two organisations learned more about each other’s platforms, it became obvious that our strengths rounded out each other’s offerings, and combined, we will have one of the most comprehensive and best-in-class platforms for financial advisors in the industry. 

“Equally important, Advisor Group and Ladenburg have a shared commitment to the flexibility of third-party clearing, together with maintaining a ‘small firm feel’ delivered through the distinct management teams and cultures of a multi-brand network model. In today’s fast-consolidating marketplace, where advisors fear becoming just another number in the crowd, the more intimate service culture and sense of community that our multi-brand approach offers is increasingly in demand.” 

Milton Berlinski, Co-Founder and Managing Partner of Reverence Capital Partners, a financial services-focused private equity firm and majority equity owner of Advisor Group, says: “Ladenburg Thalmann and Advisor Group are highly complementary businesses, with nationwide footprints, technology capabilities and senior management talent that represent the best of what the wealth management industry has to offer for financial advisors and their clients. By combining these two firms, we have created one of the most robust platforms in the country to support advisors’ growth, with the scale, resources and intellectual capital to position them for success, no matter their business model or client focus.”

Adam Malamed, Executive Vice President and Chief Operating Officer of Ladenburg, says: “The ongoing evolution of our industry validates the importance of Ladenburg and Advisor Group’s respective roles as the leading innovators of the network model of firms approach within our industry. The appeal of bringing Ladenburg and Advisor Group together is driven in large part by our shared vision for driving a transformative and innovative approach to the wealth management space. For example, among the many advantages of our multi-custodial, multi-clearing capabilities are the expertise and leadership we can further build in the RIA space. The combination of Ladenburg and Advisor Group creates a unique offering for financial advisors who are primarily fee-based, or fee-only, whether they want to have their own RIA under a turnkey level of back and middle office support, or would prefer to do fee-only work through a corporate RIA, without having to also hold securities licenses on the brokerage side of our industry.”

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