$100 Million Stock Buyback Deal Part of LPL Capital Strategy

As promised, LPL Financial, parent company of the nation’s largest independent broker-dealer, will continue its policy of “returning capital to shareholders” by agreeing to repurchase nearly 2 million shares of its common stock.

Hot on the heels of record revenues for 2013, LPL has entered into a share purchase agreement to buy 1.9 million shares for $100 million at $52 per share from TPG Global, a Fort Worth, Texas-based private equity firm that was one of the company’s original investors.

Repurchasing stock is part of LPL’s strategy of a “returning capital to our shareholders,” LPL chief financial officer Dan Arnold said during a call with analysts earlier this week following  the release of the company’s fourth quarter and year-end earnings results.

Arnold noted  that LPL  bought back $35 million of shares in the fourth quarter, “reflecting our flexibility in deploying our capital.”

“With our decision to forego pursuing a conversion to a bank holding company,” Arnold told the analysts, “we retain the capitalized nature of our model, which provides us the opportunity to continue to invest in the business and return capital to shareholders through growing dividends and share repurchases.”

TPG is also selling another 1.9 million shares of LPL common stock to a private investor, reducing TPG’s stake in the company to about 13% from 16%

In addition, Arnold and Robert Moore, the company’s president will sell a combined total of 100,000 shares to the private investor in the offering.

No shares are being sold by LPL, the company said in a release.

LPL shares were up 2.2% in Thursday afternoon trading, at $53.76.