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Ladenburg Thalmann’s Acquisition of Securities America a Done Deal

Ladenburg Thalmann (AMEX: LTS) has closed the deal to acquire independent broker/dealer Securities America from Ameriprise Financial (NASDAQ: AMP), which it had announced in August. Registered Rep. was the first to write about Ladenburg as a potential buyer of Securities America.

In the early 1990s, Ladenburg was known more for its investment banking and research capabilities. But with its recent IBD acquisitions over the last five years, including Triad and Investacorp, it has positioned itself as a large player in the retail financial services space. With the acquisition of SAI, this positions Ladenburg as one of the five largest broker/dealers, expanding its network to 2,700 advisors and $70 billion in total client assets.

“The addition of Securities America triples our existing revenue base and well positions Ladenburg to capitalize on the appealing demographic and other growth trends of the independent brokerage channel,” said Richard Lampen, president and CEO, in a statement.

Ladenburg purchased the IBD for $150 million up front, but Ameriprise may collect potential future payments in addition to the purchase price if Securities America meets certain financial criteria in 2012 and 2013.

In its annual letter to shareholders, Ladenburg executives called the SAI acquisition a “transformational event” for the company. The letter also hinted that other IBD acquisitions could be in the pipeline for Ladenburg, saying “our commitment to growth in the independent brokerage business is without equal.”

Industry sources believe the acquisition is a positive thing for SAI advisors for the most part. Ladenburg has said it plans to let SAI operate independently, so it will mean little change for the reps that have stayed on. But advisor retention really depends on how robust Ladenburg’s retention packages were. In a statement, Lampen said the firm has retained a good number of reps:

“We’ve had tremendous success retaining an extremely high percentage of advisors at Securities America, which will continue to operate on a truly independent basis under the leadership of Jim Nagengast and his talented team, a formula that has worked well for us with Triad and Investacorp.”

Ameriprise said in April it would sell Securities America after the IBD was pounded by litigation over its sale of allegedly fraudulent private placements from Medical Capital Holdings and Provident Royalties. The firm negotiated a $150 million settlement with investors earlier this year.

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