Ladenburg Thalmann to Acquire KMS Financial Services in Washington

August 13, 2014

Ladenburg Thalmann Financial Services Inc. has signed a definitive agreement to acquire KMS Financial Services Inc., a Seattle, Wash.-based independent broker-dealer and investment advisor with a strong presence in the Pacific Northwest.

Under the terms of the deal, Ladenburg will pay roughly $24 million, consisting of $11 million in cash, $8 million in four-year notes and 1,440,922 shares of Ladenburg common stock.

KMS has 325 independent financial advisors with more than $14 billion in client assets and revenues of $84 million for the 12 months ended June 30. Upon completion of the transaction, Mark Hamby, KMS’s chairman and CEO, Eric Westberg, president and COO, and the rest of the KMS management team will continue to operate KMS as a stand-alone business based in its current Seattle headquarters.

With the KMS acquisition and Ladenburg’s pending acquisition of assets of Sunset Financial Services Inc., Ladenburg’s network of independent brokerage and advisory firms will total roughly 3,500 financial advisors with $110 billion in total client assets and Ladenburg will have annual revenues of approximately $1 billion. The KMS transaction also gives Ladenburg an expanded presence in the Pacific Northwest.

business-movesLadenburg’s acquisition of KMS is expected to close later this year, and is subject to regulatory approval and other customary closing conditions. Approval by Ladenburg’s shareholders is not required.

Ladenburg is a publicly-traded diversified financial services company based in Miami, Fla. Its subsidiaries include: Securities America Inc.; Triad Advisors Inc.; Investacorp Inc.; Premier Trust Inc.; Ladenburg Thalmann Asset Management; Highland Capital Brokerage Inc.; and Ladenburg Thalmann & Co. Inc.

KMS provides access to a range of non-proprietary investment and insurance products, custodial brokerage platforms, institutional investment management and technology systems support.

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