Boenning & Scattergood, one of the Philadelphia-area’s newest full-service investment firms, said Friday it had reached its agreement to acquire LPL Financial Inc., a national brokerage firm based in San Diego. .
But not everyone makes the trip.
As Boenning’s 40 financial advisors and their clients with $5 billion in investing or trading assets join LPL, a team of 20 investment banking professionals are heading to Philadelphia-based Janney Montgomery Scott instead. , a Montgomery County-based branch of Penn Mutual Life. Insurance Co. The group going to Janney includes managing directors who lead key functions such as insurance transactions and investment research.
“We are delighted to join a company with the financial stability, resources and expertise” of Janney, who “will help our clients,” Chad Hull, former head of Boenning’s investment banking group, said in a statement. .
His new boss, Janney’s investment banking chief Matt Veneri, called him a “strong cultural fit” and said the new hires grew Janney’s capital markets team to more than 200 people. .
LPL managing director Rich Steinmeier praised Boenning & Scattergood as a “distinguished brand” and said it would be able to grow with LPL’s support. As members of a large corporation, “they have the freedom to run their business as they see fit,” with less distraction from day-to-day operations.
The decision to sell was made earlier this year by Boenning & Scattergood majority owner Harold Scattergood Jr., 74, after determining that his children would not take over the business, according to company insiders. Scattergood did not return calls seeking comment.
Last month, Scattergood told The Inquirer that the company was splitting up some investment teams, such as public finance and municipal securities trading. Joseph Muscatello of Boenning’s public finance team left earlier this year to join St. Louis-based Stifel.
Scattergood had also said that the firm’s private investment advisory business, 1914 Advisory, and its brokerage arm would continue to carry the Boenning & Scattergood name, even if that part of the firm were to combine with another company – as has now happened with LPL.
Boenning’s arrivals will modestly augment Janney’s investment banking group, which focuses on mid-sized companies. Janney’s team says it has raised $47 billion for 283 companies and other clients over the past three years. Janney says the Boenning Group has raised $1.5 billion in 120 capital-raising deals for local governments, healthcare, banks and other businesses over the past three years.
LPL has 20,000 financial advisors nationwide at companies it owns or works with.
Boenning & Scattergood, based in West Conshohocken, was founded in 1916. At the time, the city was a financial center: although not equal to Wall Street, it was home to some of the oldest and largest banks , insurers and investment houses in the country.
Philadelphia sea trader turned banker and investor Stephen Girard and his private bank financed the War of 1812; Philadelphia investment banker Jay Cooke created the first national bond sales force to finance the Union victory in the Civil War; Philadelphia banker Anthony J. Drexel was a mentor to Wall Street’s premier financier in the early 1900s, JP Morgan. Smith Barney, the giant Wall Street brokerage now owned by Citigroup, spun off from two Philadelphia investment banks.
In recent decades, declining profits from individual stock trading, coupled with digital trading technology that allows professional investors to work from anywhere, has expanded Wall Street’s major investment banks, while regional companies like Boenning have tended to sell to larger companies.