LPL Financial announced plans to acquire Lucia Securities, a small San Diego-based broker/dealer and registered investment advisory firm founded by CEO Raymond Lucia Jr. The deal, expected to close in the second half of this year, adds about 20 advisors and $1.5 billion in client assets to the independent b/d’s platform.
The deal is structured as an asset purchase agreement, and includes an upfront payment at closing and potential contingent payments. LPL values Lucia at six times post-synergy EBITDA. Raymond James advised Lucia on the deal.
“I believe our wealth management platform, enhanced with LPL’s culture, technology and capabilities, provides the ideal environment for our financial advisors to exceed clients’ expectations,” Lucia said in a statement.
This is LPL’s first b/d acquisition since Allen & Company last year, a Lakeland, Fla.-based b/d and RIA that seeded the firm’s new employee model.
Former LPL Financial senior executive Derek Bruton served a short stint as CEO of Lucia, after his departure from LPL.
Lucia also licenses his so-called The Bucket Strategy approach to other independent financial advisors, a liability-driven investment model that matches an investor’s liabilities, or needs, with their assets.
His firm has no connection to Ray Lucia Sr., his father, a nationally syndicated radio personality who in 2012 was accused by the Securities and Exchange Commission of misleading potential clients about his "Buckets of Money" investment strategy.
Lucia Sr., whom WealthManagement.com named one of its Outstanding Advisor Award winners in 2004, claimed he had successfully tested his strategy using historical data, but the SEC said he performed “scant, if any” backtesting, and the strategy’s value wasn’t proven.