John Hancock Financial Network, a U.S. unit of Canada’s Manulife Financial Corp., agreed to buy assets from the Transamerica broker-dealer subsidiary in a deal that will add as many as 1,100 advisors.
The advisors work at about 50 firms and will become affiliated with John Hancock’s Signator Investors, the buyer said in a statement Tuesday that didn’t disclose terms. The deal is expected to be completed within six months, according to the statement, and about 90 other employees who support the Transamerica operation will also join John Hancock.
Manulife CEO Donald Guloien has been bolstering asset-management operations at his Toronto-based company as he seeks to expand in the U.S. and generate new sources of fee income. John Hancock announced a deal in 2013 to buy a broker-dealer and investment advisor firm from Symetra Financial Corp.
The latest deal will “broaden distribution and recruiting through advisors who join Signator from Transamerica Financial Advisors and who have established bank-channel relationships,” John Hancock president Craig Bromley said in the statement.
Transamerica, which is owned by the Hague-based Aegon NV, is among insurers that have been scaling back some broker-dealer or wealth-management operations in the U.S. MetLife Inc. and Genworth Financial Inc. have also made divestitures in the industry in recent years.
The seller decided that the advisors “would be better supported by John Hancock’s broker-dealer unit, given their ambitions to expand” in that area, Greg Tucker, a spokesman for Transamerica, said in an email. Transamerica said it will continue to support a retail division in the U.S. that has more than 3,000 representatives who remain affiliated with World Financial Group.
U.S. financial advisors are facing the prospect of stricter Department of Labor rules to make sure they put their clients’ interest first for retirement accounts. While much of the industry has blasted the plan and said the requirements could be unworkable, Guloien took a softer approach in an interview last week.
“We think their heart is in the right place,” Guloien said in the interview. “We think the Department of Labor is trying to make sure that when people get advice, they get good advice. And they get advice that’s in the interest of their client. And we like to think we do that every day.”
–With assistance from Katia Dmitrieva in Toronto.