TD Waterhouse, Ameritrade Reach Out to RIAs

Heads of advisor units say it's "business as usual for now" despite merger plan

In the wake of Ameritrade Holding Corporation's approximately $3 billion proposed purchase of TD Waterhouse USA, the heads of the RIA units of both companies have moved to reassure advisors and their clients that "it will be business as usual for now."

In a letter to advisors signed by J. Thomas Bradley Jr., president of TD Waterhouse Institutional Services, and James Wangsness, senior vice president of Ameritrade Advisor Services, the division chiefs said that "in the coming months, a group of senior executives from both companies will be tasked with shaping this new company," to be known as TD Ameritrade. They indicated that following expected approval of the deal by U.S. and Canadian regulators in about six months, "it will then take another several months to bring the strengths of both companies together." In an interview June 23, Bradley said that "I'm very excited about this [merger]. He added that "advisors are excited as well," not the least because they will soon be able to gain access to "an incredibly expanded client base" served by the two discount brokerage firms. He added that he expects TD Waterhouse's Advisor Direct referral program to continue under the TD Ameritrade banner.

TD Waterhouse Institutional claims 2,600 "RIA relationships" with $41 billion in assets custodied at the firm, while Ameritrade has ties to another 1,400 registered investment advisors with $4.1 billion in assets in its custody. In a conference call following the announcement of the merger on June 23, Ameritrade CEO Joe Moglia, who will remain as CEO of TD Ameritrade, said no decision had been reached on who would run the combined advisor units but added that Waterhouse "is so strong in this area." Bradley said he hoped to be able to reveal more about the combined advisor units' management within three to five months. However, Jeffrey Roush, CEO of Epic Wealth Management in San Rafael, California, said, "I'd be disappointed if Tom Bradley and his group didn't survive." Roush's firm custodies at several brokers, including TD Waterhouse.

In a letter to advisors' clients posted on the TD Waterhouse Institutional Web site, meanwhile, Bradley and Wangsness said, "you continue to be our focus." They added that "the relationship between your independent financial advisor and TD Waterhouse will remain unchanged."

Wangsness declined to comment. You can view the joint letters to advisors and their clients here.

To view details of the Ameritrade-TD Waterhouse deal, you can download these pdfs of Ameritrade's Form 14A filings with the SEC:

Ameritrade Form 14A.pdf

Ameritrade Form 14A-3.pdf

Ameritrade Form 14A-6.pdf

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