March 31, 2025
Louis Diamond Quoted
By Miriam Rozen and Mason Braswell
LPL Financial has agreed to buy smaller independent brokerage rival Commonwealth Financial Network for $2.7 billion, according to an announcement on Monday.
LPL, which serves around 29,000 brokers, could boost its headcount by about 10% if it retains all 2,900 Commonwealth advisors. Commonwealth manages around $285 billion in assets and draws around 75% of its revenue from advisory-based fees, according to a presentation. Its brokers manage $100 million on average, above the $60 million managed by the typical LPL broker, executives at the acquiring firm said.
The deal, valued at a multiple of eight times Commonwealth’s $415 million in annual earnings before tax, is expected to close in the second half of 2025. It continues an acquisitive path that LPL has followed in recent years in its push for scale.
LPL did not address specifics of possible retention offers that it could extend to Commonwealth brokers as part of the deal. LPL Chief Executive Rich Steinmeier acknowledged that it could take some adjustment on the part of Commonwealth brokers, who have built a small-firm community since its founding in 1979.
“They’ll have to go through what today’s event means,” Steinmeier said on a company call following the announcement. “But we’re intending to bring the best of breed to these advisors. We want to bend LPL to look more like Commonwealth, not the other way around.”
LPL estimates it will spend about $485 million onboarding and integration costs, based on the assumption it retains 90% of Commonwealth’s roster. It also forecasted $155 million in technology costs.
Commonwealth clears through Fidelity Investments’ National Financial Service, according to BrokerCheck. Its brokers will have moved to the LPL platform by midway next year if regulators sign off on the deal, the companies said.
Waltham, Massachusetts-based Commonwealth was founded by Joseph Deitch and is led by CEO Wayne Bloom. Deitch will join LPL in an advisory role to its board, and Bloom will join LPL’s management committee and report to Steinmeier.
Bloom will also work with LPL leaders to launch an “Office of Advisor Advocacy,” aimed at improving LPL’s service for brokers, the announcement said. Bloom in a statement stressed that Commonwealth, which had hired Goldman Sachs to help it find a buyer, “will retain its brand as part of LPL.”
“Commonwealth has built an impeccable reputation as one of the most advisor-friendly independent broker dealers in the industry, so a move like this naturally raises eyebrows in questions from advisors who chose Commonwealth for its boutique feel and consistent leadership,” industry recruiter Louis Diamond said in a podcast posted on Saturday as rumors of the deal circulated.
