Prospera Financial Group is acquiring Dorsey & Company, a New Orleans-based broker-dealer and RIA with about $1.4 billion in assets under management. The deal will boost the Dallas-based Prospera’s total managed assets to more than $16 billion, with Dorsey & Company retaining its independent brand while joining as an office of supervisory jurisdiction (OSJ).
In an interview with WealthManagement.com, Dorsey & Company CEO Raymond Thompson said the OSJ designation lets the firm retain its independence while benefiting from the scale of Prospera.
Prospera co-CEO and Managing Partner Tim Edwards said adding the OSJ would benefit both firms. “That was important to them as well as to us, and this structure afforded us that opportunity,” he said.
Dorsey & Company was originally founded by George Dorsey in 1959 and specialized at first in underwriting and trading tax-free municipal bonds in Louisiana and Mississippi before his son Philip took the helm. Thompson later took over as president and CEO after the younger Dorsey died in 2019. He will become branch manager of the firm in the Prospera deal.
According to Thompson, partnering with Prospera in lieu of a larger aggregator meant maintaining the firm’s fixed-income trading expertise.
“With the combination of Prospera, we’re not only going to continue that, but we’re going to add that expertise to Prospera. Our expertise in that area will be allowed to exist, grow and flourish, which would not have happened under the framework of some other organization.”
According to Edwards, the deal illustrated how a firm like Prospera was better equipped to make acquisitions than at any point in the past, as some smaller firms were cautious about losing their independence in the process of being “gobbled up” by larger organizations. In contrast, Edwards argued a firm like Prospera could help a seller like Dorsey retain its brand while eliminating obstacles to growth, noting compliance, regulation and tech mandates were becoming more challenging for smaller firms.
“So, positioning them, if we can remove all those necessary things they need to do that can be a distraction to running and growing a business, they’ll be offloading that to us and being more focused on being advisors, and again, on running and growing their business,” Edwards said. That’s what was attractive about the acquisition, and I think we’ll see that trend growing within the industry.”
Prospera Financial was founded in 1982, and prior to the Dorsey deal had nearly 150 financial advisors throughout the country. The firm has completed a number of deals throughout the course of the year, including a spate of additions in the spring ranging from the Arizona and Calif.-based Johnson Wealth Management, the Redwood City, Calif.-based Redwood Advisory Group (with advisor Steven Loerke joining from UBS), as well as the Mich.-based Eriksen Financial Affiliates. In late August, the firm announced a partnership with Cascade Wealth Management, a Bend, Ore.-based firm with about $420 million AUM.