National Planning Holdings® announced the sale of its independent broker-dealer network, consisting of INVEST Financial Corporation® (INVEST®), Investment Centers of America, Inc. (ICA), National Planning Corporation® (NPC®) and SII Investments, Inc.® (SII), to LPL Financial LLC (LPL), the nation’s largest independent broker-dealer.
The transaction is structured as an asset sale, which includes substantially all of the business of the network, for an initial purchase price of $325 million.
Following a successful transition of NPH’s financial advisors and clients to LPL, the purchase price may increase to a maximum of approximately $448 million.
The transition period is expected to be completed by the end of the first quarter of 2018.
NPH is an affiliate of Jackson National Life Insurance Company®, a leading manufacturer of retirement products in the U.S. Jackson and NPH are indirect, wholly owned subsidiaries of Prudential plc.
Barry Stowe, chairman and chief executive officer of Prudential plc’s North American Business Unit, said the industry is in a time of significant regulatory change and consolidation in the independent broker-dealer sector.
“While we still very much believe in the independent broker-dealer model, our primary strategy in North America is to focus on being the leading manufacturer of retirement products,” Stowe said.
“The transaction with LPL provides us with a compelling opportunity to divest our ownership in the NPH network to a leading independent broker-dealer well suited to support financial advisors and their retail clients going forward.”
LPL offers an integrated platform of proprietary technology, brokerage and investment advisor services to more than 14,000 financial advisors and approximately 700 financial institutions.
LPL also supports more than 3,700 other financial advisors with customized clearing solutions, advisory platforms and technology.
“At LPL, NPH clients and their financial advisors will benefit from our scale, strength and breadth of services, including the advantages of our self-clearing platform,” said Dan Arnold, president and chief executive officer of LPL.
“We are able to leverage our advisory and brokerage platforms to create better economics for our financial advisors and ultimately better economics for their clients.”
Scott Romine, president and chief executive officer of NPH, added, “Given the similarities in LPL’s independent model to the NPH model, we believe LPL is the ideal acquirer to ensure continuity of the quality service and support for our clients and their financial advisors.”
During the transition period, the NPH firms will continue to maintain all necessary infrastructure of their businesses to ensure uninterrupted support and a smooth transition of all client accounts and their financial advisors.
By year-end 2018, and subject to regulatory approval, the NPH firms intend to wind down the operations and withdraw their broker-dealer registrations.
