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Prudential sells US broker-dealer arm for $448 million

Prudential sells US broker-dealer arm for $448 million

Prudential has sold its US independent broker-dealer network to US giant LPL Financial in a deal worth up to $448 million (£347.2 million).

The deal was struck through Pru’s subsidiary, Planning Holdings, and will see the sale of Invest Financial Corporation, Investment Centers of America, National Planning Corporation and SII Investments.

LPL Financial, the US’s biggest independent broker-dealer, is to pay an initial £325 million for their assets, with the figure set to rise to up to $448 million, subject to ‘transition criteria’ being met. The transaction has been completed after receiving regulatory approval and is expected to complete by the end of the first quarter next year.

Barry Stowe, chairman and chief executive officer of Prudential’s North American business, said: ‘While we still very much believe in the independent broker-dealer model, our primary strategy in North America is to focus on being the leading manufacturer of retirement products.

‘The transaction with LPL Financial provides us with a compelling opportunity to divest our ownership in the NPH network to a leading independent broker-dealer well suited to support financial advisors and their retail clients going forward.’

Speculation has been mounting that the Prudential business is set to be broken up, with rumours that Legal & General is lining up a bid for £10 billion worth of Pru’s annuities business, earlier this week.

This follows on from news last week that Pru is to merge M&G Investments with its Prudential UK & Europe division to create M&G Prudential, a £332 billion financial services giant.

 

 

 

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