PHOENIX, Nov. 11, 2019 /PRNewswire/ -- Advisor Group,
one of the nation's largest networks of independent wealth
management firms, and Ladenburg Thalmann Financial Services Inc.
(NYSE American: LTS, LTS PrA, LTSL, LTSF, LTSK, LTSH)
("Ladenburg"), a publicly-traded diversified financial services
company, today announced that both companies have entered into
a definitive merger agreement to join the two companies.
Under the terms of the transaction, Ladenburg has agreed to be
acquired by Advisor Group through a cash merger, in which each
outstanding share of Ladenburg's common stock will be converted
into a cash payment of $3.50 per
share. The total enterprise value of the transaction is
approximately $1.3 billion, taking
into account Ladenburg's common stock, preferred stock and
outstanding debt. The definitive merger agreement and the
transactions contemplated were unanimously approved by Ladenburg's
Board of Directors.
The transaction, which is subject to customary closing
conditions, including the approval of Ladenburg's shareholders, and
receipt of required regulatory clearances and approvals, is
expected to close in the first half of 2020.
Following the completion of this transaction, the expanded
Advisor Group organization will continue to be led by its current
CEO and President, Jamie
Price. When the transaction is completed, Advisor
Group's leadership team will include senior executives from both
Advisor Group and Ladenburg. Ladenburg's firms will not be
merged with Advisor Group's firms, reflecting both companies'
commitment to a multi-brand network model.
Advisor Group's network of firms consists of FSC Securities
Corporation, Royal Alliance Associates, SagePoint Financial and
Woodbury Financial. Ladenburg's independent advisory and
brokerage firms include Securities America, Triad Advisors,
Investacorp, KMS Financial Services and Securities Service Network
(SSN).
Additional Ladenburg subsidiaries include Highland Capital
Brokerage, a leading insurance solutions brokerage; Premier Trust,
a financial advisor-focused trust services company; and Ladenburg
Thalmann & Co., a middle market investment bank. Each of
these subsidiaries has played a role in delivering unique,
value-add solutions to Ladenburg-affiliated financial advisors.
Ladenburg Thalmann Chairman, President and CEO Richard Lampen said, "This is a transaction that
maximizes value for our shareholders, while positioning our
financial advisors for continued growth and success. We have
always been impressed with Advisor Group's platform, offerings and
leadership. Advisor Group's CEO, Jamie Price, and his management team offer a
mature shared services model and a demonstrated ability to innovate
and invest in ways that help advisors grow. We are confident
this transaction will help our advisors accelerate the growth of
their businesses, while enabling them to benefit from the highly
personalized service experience they have always enjoyed, under a
very similar multi-custodial, multi-clearing and multi-brand
structure."
Advisor Group President and CEO Jamie
Price said, "This acquisition brings together the best of
two industry leaders, to the benefit of the financial advisors we
collectively serve. We believe that the investments necessary
for competitively differentiated technology, practice management,
products and service excellence require a greater level of scale
than either of our companies can achieve on a stand-alone basis.
In fact, as our two organizations learned more about each
other's platforms, it became obvious that our strengths rounded out
each other's offerings, and combined, we will have one of the most
comprehensive and best-in-class platforms for financial advisors in
the industry. Equally important, Advisor Group and Ladenburg
have a shared commitment to the flexibility of third-party
clearing, together with maintaining a 'small firm feel' delivered
through the distinct management teams and cultures of a multi-brand
network model. In today's fast-consolidating marketplace,
where advisors fear becoming just another number in the crowd, the
more intimate service culture and sense of community that our
multi-brand approach offers is increasingly in demand."
Milton Berlinski, Co-Founder and
Managing Partner of Reverence Capital Partners, a leading financial
services-focused private equity firm and majority equity owner of
Advisor Group, said, "Ladenburg Thalmann and Advisor Group
are highly complementary businesses, with nationwide footprints,
technology capabilities and senior management talent that represent
the best of what the wealth management industry has to offer for
financial advisors and their clients. By combining these two firms,
we have created one of the most robust platforms in the country to
support advisors' growth, with the scale, resources and
intellectual capital to position them for success, no matter their
business model or client focus."
Giving Advisors the Best of the Best in Platforms, Tools and
Expertise
Following the completion of this transaction, Advisor Group will
continue to operate under a multi-brand network model of firms,
enabling the delivery of industry-leading tools and expertise
through distinct firms with unique brands that each offer a sense
of community and personalized service for affiliated financial
advisors.
Financial advisors affiliated with Ladenburg's subsidiary firms
are expected to benefit from Advisor Group's recent investments in
cutting-edge enterprise-level service offerings, including eQuipt,
the firm's fully-digital client onboarding system; MyCMO, its
personalized advisor marketing platform; MySuccessionPlan.com, its
suite of bundled succession planning resources; and its integrated
CyberGuard Program for cybersecurity.
For advisors affiliated with Advisor Group, the transaction
brings access to Ladenburg Thalmann's industry-leading practice
management capabilities, wealth management resources,
advisor-client portal technologies and expanded national scale.
The two companies also feature strong cultural similarities,
including a shared commitment to supporting greater diversity
across the industry, including advancing career opportunities for
women financial advisors and women executives, as evidenced by
Advisor Group's Women Forward initiative and the Ladenburg
Institute of Women & Finance.
Multi-Custodial, Multi-Clearing Approach Minimizes Disruption
and Maximizes Flexibility; Positions Company for Future Leadership
in RIA Segment
Upon the transaction's completion, Advisor Group will be one of
the industry's leading providers of a multi-custodial,
multi-clearing model that drives maximum choice and flexibility for
financial advisors.
Because both Advisor Group and Ladenburg use Pershing and
National Financial (part of Fidelity Custody & Clearing
Solutions) as their largest clearing providers, no repapering of
client accounts will be necessary in connection with this
transaction and its closing.
As one of the largest multi-custodial and multi-clearing
networks of firms in the country, the company will be even better
positioned to redefine the RIA segment of the wealth management
space. The combined company will be able to support all
financial advisor business models, including the hybrid advisor
doing both securities and advisory business, as well as the
"investment advisor only" professional who is either utilizing a
corporate RIA platform, or has an independent RIA.
Adam Malamed, Executive Vice
President and Chief Operating Officer of Ladenburg, said, "The
ongoing evolution of our industry validates the importance of
Ladenburg and Advisor Group's respective roles as the leading
innovators of the network model of firms approach within our
industry. The appeal of bringing Ladenburg and Advisor Group
together is driven in large part by our shared vision for driving a
transformative and innovative approach to the wealth management
space. For example, among the many advantages of our
multi-custodial, multi-clearing capabilities are the expertise and
leadership we can further build in the RIA space. The combination
of Ladenburg and Advisor Group creates a unique offering for
financial advisors who are primarily fee-based, or fee-only,
whether they want to have their own RIA under a turnkey level of
back and middle office support, or would prefer to do fee-only work
through a corporate RIA, without having to also hold securities
licenses on the brokerage side of our industry."
Financial and Legal Advisors to the Transaction
Jefferies LLC is acting as financial advisor to Ladenburg, with
Sullivan & Cromwell LLP serving as Ladenburg's legal counsel.
Eversheds Sutherland, Kirkland & Ellis LLP, and Greenberg
Traurig LLP are serving as legal counsel to Advisor Group and
Reverence Capital.
Committed financing for this transaction has been provided by
Bank of America, UBS Securities, Barclays, Deutsche Bank Securities
and Goldman, Sachs & Co.
About Advisor Group
Advisor Group, Inc. is one of the
nation's largest networks of independent financial advisors serving
over 7,000 advisors and overseeing $271
billion in client assets. Headquartered in Phoenix, AZ, the firm is mission-driven to
support the heroic role that advisors can play in the lives of
their clients, offering securities and investment advisory services
through its subsidiaries FSC Securities Corp., Royal Alliance
Associates Inc., SagePoint Financial, Inc. and Woodbury Financial
Services, Inc., as broker/dealers, registered investment advisors
and members of FINRA and SIPC. Cultivating a spirit of
entrepreneurship and independence, Advisor Group champions the
enduring value of financial advisors and is committed to being in
their corner every step of the way. For more information visit
https://www.advisorgroup.com.
About Ladenburg Thalmann
Ladenburg Thalmann Financial
Services Inc. (NYSE American: LTS, LTS PrA, LTSL, LTSF, LTSK, LTSH)
is a publicly-traded diversified financial services company based
in Miami, Florida. Ladenburg's
subsidiaries include industry-leading independent advisory and
brokerage (IAB) firms Securities America, Triad Advisors,
Securities Service Network, Investacorp and KMS Financial Services,
as well as Premier Trust, Ladenburg Thalmann Asset Management,
Highland Capital Brokerage, a leading independent life insurance
brokerage company and full-service annuity processing and marketing
company, and Ladenburg Thalmann & Co. Inc., an investment bank
which has been a member of the New York Stock Exchange for over 135
years. The company is committed to investing in the growth of its
subsidiaries while respecting and maintaining their individual
business identities, cultures, and leadership. For more
information, please visit www.ladenburg.com.
About Reverence Capital Partners
Reverence
Capital Partners is a private investment firm focused on thematic
investing in leading global, middle-market Financial Services
businesses through control and influence oriented investments in 5
sectors: (1) Depositories and Finance Companies, (2) Asset and
Wealth Management, (3) Insurance, (4) Capital Markets and (5)
Financial Technology/Payments. The firm was founded in 2013, by
Milton Berlinski, Peter Aberg and Alex
Chulack, after distinguished careers advising and investing
in a broad array of financial services businesses. The Partners
collectively bring over 90 years of advisory and investing
experience across a wide range of financial services
sectors. For more information visit
www.reverencecapital.com.
Additional Information and Where to Find It
This press release may be deemed to be solicitation material
in respect of the proposed merger between Ladenburg Thalmann
Financial Services Inc. ("Ladenburg") and Harvest Merger Sub, Inc.
("Merger Sub"), a wholly owned subsidiary of Advisor Group
Holdings, Inc. ("Advisor Group"), and other transactions
(collectively, the "Transaction") contemplated by the Agreement and
Plan of Merger, dated as of November 11,
2019 (the "Merger Agreement"), by and among Ladenburg,
Advisor Group and Merger Sub. In connection with the Transaction,
Ladenburg intends to file relevant materials with the Securities
and Exchange Commission (the "SEC"), including a proxy statement on
Schedule 14A. INVESTORS AND SHAREHOLDERS OF LADENBURG ARE URGED
TO READ ALL RELEVANT DOCUMENTS FILED WITH THE SEC, INCLUDING
LADENBURG'S PROXY STATEMENT, BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and
shareholders will be able to obtain copies of the documents, when
filed, free of charge at the SEC's website (http://www.sec.gov).
Investors and shareholders may also obtain copies of documents
filed by Ladenburg with the SEC by contacting Ladenburg at Investor
Relations, Ladenburg Thalmann Financial Services, Inc., 4400
Biscayne Boulevard, 12th Floor, Miami,
Florida 33137, by email at CorporateRelations@ladenburg.com,
or by visiting Ladenburg's website
(http://ir.stockpr.com/ladenburg).
Participants in Solicitation
Ladenburg and its directors, executive officers and other
members of management and employees may be deemed to be
participants in the solicitation of proxies from the holders of
Ladenburg Common Stock in connection with the proposed Transaction.
Information about Ladenburg's directors and executive officers is
available in Ladenburg's proxy statement for its 2019 Annual
Meeting of Shareholders, which was filed with the SEC on
April 30, 2019. Other information
regarding the participants in the proxy solicitation and a
description of their direct and indirect interests, by security
holdings or otherwise, will be contained in the proxy statement and
other relevant materials to be filed with the SEC regarding the
proposed Transaction when they become available. Investors and
shareholders should read the proxy statement carefully when it
becomes available before making any investment or voting
decisions.
Forward-looking Statements
This press release contains forward-looking statements. You
can generally identify forward-looking statements by the use of
forward-looking terminology such as "anticipate," "believe,"
"continue," "could," "estimate," "expect," "explore," "evaluate,"
"intend," "may," "might," "plan," "potential," "predict,"
"project," "seek," "should," or "will," or the negative thereof or
other variations thereon or comparable terminology. These
forward-looking statements are only predictions and involve known
and unknown risks and uncertainties, many of which are beyond
Ladenburg's and Advisor Group's control. Statements in this
document regarding Ladenburg and Advisor Group that are
forward-looking, including, without limitation, projections as to
the anticipated benefits of the proposed Transaction and the
closing date for the proposed Transaction, are based on
management's estimates, assumptions and projections, and are
subject to significant uncertainties and other factors, many of
which are beyond the control of Ladenburg and Advisor Group.
Important risk factors could cause actual future results and other
future events to differ materially from those currently estimated,
including, but not limited to: (i) the timing to consummate the
proposed Transaction; (ii) the risk that a condition to closing of
the proposed Transaction may not be satisfied and the Transaction
may not close; (iii) the risk that a regulatory approval that may
be required for the proposed Transaction is delayed, is not
obtained or is obtained subject to conditions that are not
anticipated; (iv) the risk that a sufficient number of shares of
Ladenburg Common Stock are not voted in favor of the proposed
Transaction; (v) the occurrence of any event, change or other
circumstance that could give rise to the termination of the Merger
Agreement; (vi) the effect of the announcement or pendency of the
Transaction on Ladenburg's business relationships, operating
results, and business generally; (vii) risks that the proposed
Transaction disrupts current operations of Ladenburg and potential
difficulties in Ladenburg employee retention as a result of the
Transaction; (viii) risks related to diverting management's
attention from Ladenburg's ongoing business operations; (ix) the
outcome of any legal proceedings that may be instituted against
Ladenburg related to the Merger Agreement or the Transaction; and
(x) the amount of the costs, fees, expenses and other charges
related to the Transaction. The list above is not exhaustive.
Because forward looking statements involve risks and uncertainties,
the actual results and performance of Ladenburg may materially
differ from the results expressed or implied by such statements.
Given these uncertainties, readers are cautioned not to place undue
reliance on such forward-looking statements. Unless otherwise
required by law, Ladenburg also disclaims any obligation to update
its view of any such risks or uncertainties or to announce publicly
the result of any revisions to the forward-looking statements made
herein.
Readers should carefully review the risks and uncertainties
disclosed in Ladenburg's reports with the SEC, including those set
forth in Part I, "Item 1A. Risk Factors" in Ladenburg's Annual
Report on Form 10-K for the fiscal year ended December 31, 2018 and in subsequent Quarterly
Reports on Form 10-Q and other reports or documents Ladenburg files
with, or furnishes to, the SEC from time to time. Except as
specifically noted, information on, or accessible from, any website
to which this press release contains a hyperlink is not
incorporated by reference into this press release and does not
constitute a part of this press release. No assurances can be given
that any of the events anticipated by the forward-looking
statements will transpire or occur, or if any of them do occur,
what impact they will have on the results of operations or
financial condition of Ladenburg or Advisor Group. All
forward-looking statement in this communication are qualified in
their entirety by this cautionary statement
*Assets as of September 30,
2019
Media Inquiries
For Advisor Group & Ladenburg
Thalmann:
Joseph Kuo /
Chris Clemens
Haven Tower Group
424 317 4851 or 424 317 4854
jkuo@haventower.com or cclemens@haventower.com
For Ladenburg Thalmann:
Jared
Levy / Emily Claffey /
Benjamin Spicehandler
Sard Verbinnen & Co
212-687-8080
For Reverence Capital Partners:
Steve Lipin / Michael
Flaherty
Gladstone Place Partners
212-230-5930
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SOURCE Ladenburg Thalmann Financial Services Inc.