LPL, the largest independent broker-dealer, filed S-1 forms with the Securities Exchange Commission Friday to become a public corporation.
According to a press release, the offering will consist of primary shares to be sold by the company and secondary shares to be sold by some of its existing minority stockholders. LPL, which is based in Boston, plans to use the net proceeds from the proposed public offering to repay debt.
According to LPL's filing with the SEC, the firm said: "With our focus and scale, we are not only a beneficiary of the secular shift among advisors toward independence, but an active catalyst of this trend."
Underwriters will be Goldman Sachs, Morgan Stanley, B of A Merrill Lynch and JP Morgan.
Despite the fact that revenues fell last year from their 2008 high, LPL held its No. 1 position on the FP50 list of independent broker-dealers in 2010, with revenues of $2.57 billion last year.
LPL also said in the filing that its advisor base has grown to 12,026 as of March 31, from 3,569 advisors in 2000, representing a compound annual growth rate] n excess of 14%. But the filing also said that there were 12,294 advisors last year at March 31.
In addition, LPL said that as of March 31, "advisory and brokerage assets totaled $285 billion, of which $81 billion was in advisory assets." Last year, brokerage sales were over $28 billion, including over $10 billion in mutual funds and $14 billion in annuities. Advisory sales were over $23 billion, which consisted primarily of mutual funds, the firm stated.
Total assets in LPL’s commission-based products were approximately $204 billion as of March 31.
The firm’s fee-based platforms provide access to no-load/load-waived mutual funds, exchange-traded funds, stocks, bonds, conservative option strategies, unit investment trusts and no-load, institutional money managers and multi-manager variable annuities. As of March 31, 2010, the total assets in these platforms was $81 billion.
And, as of the same date, the total assets in LPL’s cash sweep programs, which are held within brokerage and advisory accounts, exceeded $18 billion, the firm said in the SEC filing.
LPL has offices in Boston, Charlotte, and San Diego. It offer comprehensive clearing and compliance services, practice management programs and training, and independent research to over 12,000 financial advisors, more than 750 financial institutions, and approximately 4,000 institutional clearing and technology subscribers.
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