Miami, FL-based Ladenburg Thalmann Financial Services is to acquire KMS Financial Services, a Seattle-based independent broker-dealer and investment advisor with a strong presence in the Pacific Northwest.

Miami, FL-based Ladenburg Thalmann Financial Services is to acquire KMS Financial Services, a Seattle-based independent broker-dealer and investment advisor with a strong presence in the Pacific Northwest.

The move is part of Ladenburg’s strategy to strengthen its network of independent brokerage and advisory firms and its market share in the industry, the firm said today.

Ladenburg will pay approximately $24 million, consisting of $11 million of cash, $8 million of four-year notes and 1,440,922 shares of Ladenburg common stock.

Founded in 1971, KMS has approximately 325 independent financial advisors with over $14 billion in client assets and revenues of approximately $84 million for the 12 months ended June 30, 2014.

Upon completion of the transaction, Mark Hamby, KMS’s chairman and chief executive, Eric Westberg, its president and chief operating officer, 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 recently-announced, pending acquisition of the assets of Sunset Financial Services, Ladenburg’s network of independent brokerage and advisory firms will total approximately 3,500 financial advisors with $110 billion in total client assets. Ladenburg will have annual revenues of approximately $1 billion.

“This transaction shows Ladenburg’s commitment to the proposition that the independent brokerage and advisory business is one of the most dynamic areas of the financial services industry,” said Dr Phillip Frost, Ladenburg’s chairman of the board and principal shareholder.  

KMS advisors will have access to the products and services offered by Ladenburg including: access to investment banking and capital markets resources; equity research; a fixed income trading desk; wealth management services through Ladenburg Thalmann Asset Management; point-of-sale support for life insurance products through Highland Capital Brokerage; and trust services through Premier Trust.

Ladenburg acquired its first independent broker-dealer firm in 2007; its subsidiaries today include Securities America, Triad Advisors and Investacorp.

The acquisition 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.