LPL Financial, the nation's largest independent broker-dealer, has recently announced its acquisition of Crown Capital Securities. Crown Capital Securities currently has 260 advisors who collectively oversee approximately $6.5 billion of advisory and brokerage assets.

Expansion Efforts Continues

LPL Financial (ticker: LPLA) has been consistently expanding its operations and services in recent years. By introducing new affiliation models for financial advisors and acquiring other companies, LPL's advisor head count now exceeds 21,000. With $1.18 trillion in assets as of March 30, LPL Financial remains a dominant player in the industry.

Consolidation in the Broker-Dealer Sector

The acquisition of Crown Capital Securities is a clear example of the consolidation trend within the broker-dealer sector. Firms are increasingly focusing on achieving greater scale and efficiency to adapt to the ever-rising costs of regulation and technology implementation.

Jonathan French, president of Crown Capital, confirms that several wealth management firms had expressed interest in acquiring Crown Capital in the past. However, it was not until LPL Financial's extensive resources and a combination of other favorable factors that Crown Capital became more open to negotiations.

Retained Independence with Added Benefits

Crown Capital Securities, founded in 1999, will maintain its brand and existing structure under the new ownership. Advisors will be able to preserve their familiar culture and continue working with the same employees from their Orange County office. At the same time, they will have access to LPL's extensive resources, making the acquisition a beneficial "best-of-both-worlds" scenario.

Rich Steinmeier, LPL's managing director and divisional president of business development, emphasizes the importance of preserving Crown Capital's culture. This approach aligns with LPL Financial's model for other acquisitions as well.

LPL Financial expects the acquisition to be finalized in early 2024, further solidifying their position in the industry and demonstrating their ongoing commitment to growth and expansion.

LPL Financial Acquires Crown Capital, Boosting Presence in California

LPL Financial has announced its acquisition of Crown Capital, a move that will strengthen its presence in California and expand its resources for advisors. Phyllis Paulsen, Executive Vice President of Crown Capital, expressed that this decision was an emotional one for the firm, but they believe LPL is the ideal choice to support their advisors in taking their businesses to the next level.

Crown Capital, which currently uses Charles Schwab as its custodian, has its headquarters in Orange County and a significant number of advisors based in California. Additionally, it holds a strong presence in the Pacific Northwest.

With this acquisition, LPL Financial aims to provide more resources and technology to Crown Capital advisors. Steve Steinmeier, CEO of LPL Financial, emphasizes the opportunity to enhance Crown's capabilities and ensure their continued growth.

The independent broker-dealer sector has experienced consolidation in recent years, with large firms like LPL Financial benefiting from this trend. LPL added 900 advisors to its roster when it acquired the wealth management business of Waddell & Reed two years ago. Furthermore, Cetera announced its plan to acquire Securian's wealth management business, potentially increasing its advisor count by 1,000.

LPL Financial will report its second-quarter earnings after the market closes on July 27.

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