LPL Financial's acquisition last month of Commonwealth Financial Network took a lot of wealth management industry professionals by surprise. That included many of Commonwealth’s advisors, who expected the fiercely independent firm to remain so for the long term.
And the advisors have a big decision to make. Do they take LPL’s retention offer and join a much bigger company with a very different approach to doing business? Do they strike out on their own? Or do they shop around and consider buyout offers from the likes of Raymond James or Wells Fargo?
Stacy Spedden-Irrgang, a partner at Heritage Financial Consultants in suburban Baltimore, may not have firsthand knowledge of the Commonwealth-LPL situation but does have experience that could help advisors facing such questions. She’s lived through a headline-grabbing acquisition that saw her firm acquired by a significantly larger entity.
In Spedden’s case, the deal in question was Osaic’s 2024 purchase of broker-dealers and RIAs Lincoln Financial Advisors and Lincoln Financial Securities from Lincoln Financial Group. As Spedden recently told ThinkAdvisor, her practice had been based within Lincoln Financial for more than 30 years before Osaic’s acquisition, which involved about 1,450 advisors being merged into an organization with about 10 times that number.
Those numbers are roughly in proportion to the Commonwealth-LPL deal, with the former bringing nearly 3,000 advisors to an organization with some 30,000 advisors. Other particulars of the two deals differ, of course, particularly LPL’s structure as a publicly traded company compared with Osaic’s majority private equity ownership.
Still, Spedden’s explanation of why her firm ultimately decided to stay with Osaic should be informative to any advisor facing a similar situation.
One key, she said, is going into the process with an open mind and “thinking about more than just a big potential buyout check.” For acquirers, she added, the ability to listen and solve problems in a transparent manner is more important than a perfect transition process.
Here are highlights from our conversation, edited for length and clarity:
THINKADVISOR: Before we discuss your transition to Osaic last year, can you reflect on the scope of your 30 years within Lincoln Financial?
STACY SPEDDEN-IRRGANG: Yes, of course. My career within Lincoln started back in 1993, so yes it’s now been more than 30 years, in fact.
The beginning of my career really coincided with the earliest days of comprehensive financial planning and the start of what you could refer to as producer groups within Lincoln — like-minded advisors who were willing to work together to win and serve clients more holistically.
What we basically did was transition from the long-standing regional office approach and kind of broke out on our own to create a standalone entity within Lincoln called Heritage Financial Consultants.
How did you strive to differentiate Heritage from what other people were doing?
Well, we wanted to focus on comprehensive financial planning and create a bit of distance between what we were doing and what the typical insurance person was doing. It was a challenge at first, since we’re here in the Northeast, and Lincoln Financial always had a very strong reputation as an insurance carrier and retirement benefit provider.
So we had to really be conscientious about positioning the brand and marketing ourselves as a provider of more comprehensive financial planning.
How has the approach to running Heritage evolved over time, and how has the advisor pool and staff grown?
It’s been a steady evolution. From the mid-90s through to today, we’ve grown significantly in terms of staffing and the number of advisors. All the financial planners have their own book of business, but we do share a lot of work, as well, and we’re intentional about bringing in people with complementary expertise across planning domains.
It’s a great model, I think, because a lot of us here do a tremendous amount of joint work in service of our clients, and we’ve built out the staff to really create our own company — including a chief operations officer, a chief financial officer, a market leader, a receptionist, etc.
Something I’m proud of is our longstanding partnership with Towson University, which is a public university here in the Baltimore area. They have a great financial planning degree program that has been an amazing source of both interns and professional talent for us over the years — especially here in our Hunt Valley office.
So, what was the Osaic acquisition process like? Had you previously considered any acquisition offers or even a transition to become an independent RIA?
You know, we weren’t really out shopping or looking for a different place to go. Given the industry trends and news about M&A deals coming down left and right, it was a topic of discussion now and again. Is the RIA channel better? Do we take a buyout? The truth is that people were coming in and flashing checks, and that can be very tempting.
We didn’t end up making any moves, and so we were still part of Lincoln Financial when it was announced that we were all being acquired by Osaic. That meant we now had to make a choice. Do we stay or do we jump ship?
Ultimately, we decided to stay and give Osaic a go. We did our due diligence and we looked at all of our options, and we concluded that the best course of action was to give them a chance.
What was the main thinking behind staying?
I would say the leadership quality at Osaic — that was a big thing. Previously, at Lincoln, we had always had a deep connection and an open line of communication with the C-suite. They were able to make a pretty big company feel like a small company, and Osaic came in with the same mentality. They really did a tremendous job of giving us that same feel from the start.
Another factor was that we didn’t want to take aggressive steps that could see Heritage really break apart after we had spent so much time building a cohesive brand and business. If we had chosen to go to a competitor, there was no guarantee that we would all come to the same conclusion.
At the end of the day, this is a people business — a relationship business. When Osaic’s leadership team came into our office, they seemed like genuinely transparent people and they had a lot of shared ideas about how to serve clients and support advisors. We had a great feeling about it from the beginning.
What can you tell us about the transition process? Any unexpected hiccups?
We are now about a year out from the purchase, and our actual practice transition happened in January.
What’s really important to talk about is that the process was not 100% smooth, but that’s not the end of the story. There were some issues that came up in the repapering process, but the Osaic team handled them so well. They were just so transparent and responsive that it made a big impression on all of us, and it gave us even more confidence that we had made the right decision.
It’s like the saying, it’s not about having problems — it’s about how you handle them that shows your character. During the process, we had weekly calls to check in and tackle any problems that came up. They showed us that they genuinely cared about what was working and what wasn’t working 100% as expected.
We always felt like we had responsive leadership at Lincoln, but Osaic’s support has been on an even higher level. They have fixed a lot of things quickly that in our old world would have never gotten fixed.
Now that the dust has settled, do you have any thoughts for advisors potentially facing a similar situation?
I would say, just pause and take a breath. It’s important to know that the grass isn’t always greener, and it’s important to think about more than just a potential transition check. You have to think about the disruption to your business and the disruption to your clients.
Pictured: Stacy Spedden-Irrgang
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