Six months after it announced plans to buy five broker-dealers owned by Ladenburg Thalmann, Advisor Group says three of them will be merged into the largest BD in this network.
KMS Financial Services, Securities Service Network and Investacorp are set to become part of Securities America by year-end. RIA-focused Triad Advisors will remain a standalone BD.
“At the time of the announcement [in November], one thing we knew for sure was that we would deploy our shared services capability. This is how we efficiently run Advisor Group,” said CEO and President Jamie Price in an interview.
(Related: Ex-Ladenburg BDs May Face Culture Clash)
“We have a single [operations], finance and national sales departments and a single technology platform,” he added.
Over the past month, Price says, it became clear that Advisor Group would need as long as two years to launch straight-through processing, digital signature and related technology for onboarding and client service for the five separate firms.
Securities America currently has about 2,600 advisors, while Triad has nearly 650. KMS, SSN and Investacorp have a total of about 1,000 advisors. Thus, after the BD closings and mergers, Securities America — led by Jim Nagengast — could have about 3,600 registered reps.
“The Ladenburg Thalmann advisors have been clamoring for [this] equipment, the wealth management platform and the MyCMO digital platform,” he added.
Given that Securities America already handles many operating functions and that combining the four BDs would not entail client repapering, Advisor Group made the decision that it announced Monday, Price says.
“It’s a very easy way to bring the full set of capabilities that we promised … from day one” to these advisors, he explained.