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Reverence-backed Advisor Group in talks to buy Ladenburg Thalmann

Private equity is apparently picking up another wealth manager.

Ladenburg Thalmann, a network of five independent broker-dealers, is in talks to be sold to Advisor Group, Bloomberg reported Nov. 1. Jefferies is advising on the process, sources said.

Bids for Ladenburg were due last week, according to a GP who passed on the deal. Ladenburg could sell for close to $1 billion, InvestmentNews said.

Ladenburg Thalmann is a network of five broker dealers: Securities America, Triad Advisors, Investacorp, Securities Service Network and KMS Financial Services. Ladenburg’s network has more than 4000 financial advisers, who manage over $125 billion in total client assets, the firm’s website said.

Advisor Group is backed by Reverence Capital, the PE firm led by Milton Berlinski. Berlinski co-founded Reverence in 2013 after concluding a 26-year career at Goldman Sachs. Reverence, of New York, invests in financial services.

Reverence acquired Advisor Group earlier this year. The deal was valued at more than $2 billion. Other investments include CardWorks, Kabbage, Russell Investments, Transact, and Vida Capital.

Ladenburg, of Miami, is part of Ladenburg Thalmann Financial Services Inc, a publicly traded financial services firm that also includes an investment bank, insurance services and asset management. Ladenburg saw its shares rise by 12 percent after news leaked that the company was up for sale earlier this week. The company’s market cap is $386.2 million.

Ladenburg is the latest wealth manager to get scooped up by private equity.

Genstar Capital and Lovell Minnick Partners agreed to sell a stake in Mercer Advisors to Oak Hill Capital in September. In July, Lightyear Capital sold Wealth Enhancement Group to TA Associates. Goldman Sachs in May inked a deal to buy United Capital Financial Partners. Warburg Pincus also won the auction for Kestra Financial in February.

Jefferies declined comment. Executives for Reverence Capital and Ladenburg could not be reached for comment.

Action Item: See Reverence Capital’s latest form ADV here.