LPL Financial Announces Pricing of Its Common Stock Offering

Rhea-AI Summary

LPL Financial Holdings Inc. (NASDAQ: LPLA) has announced the pricing of its public offering of 4,687,500 common stock shares at $320.00 per share. The company granted underwriters a 30-day option to purchase up to 703,125 additional shares. The offering is expected to close on April 2, 2025.

Morgan Stanley & Co. serves as the sole active book-running manager, with multiple firms acting as joint book-running managers and co-managers. The net proceeds will primarily fund the cash consideration for LPL's proposed acquisition of Commonwealth Financial Network, with any remaining funds allocated to general corporate purposes.

LPL Financial currently supports nearly 29,000 Financial Advisors and approximately 1,200 financial institutions, managing about $1.7 trillion in brokerage and advisory assets for approximately 6 million Americans.

Positive

• Significant capital raise through 4,687,500 shares at $320.00 per share
• Strategic expansion through planned acquisition of Commonwealth Financial Network
• Strong market position with $1.7 trillion in assets under management
• Large advisor network with 29,000 Financial Advisors and 1,200 financial institutions

Negative

• Potential dilution of existing shareholders through new share issuance
• Additional debt expected to fund acquisition beyond stock offering proceeds

Insights

Financial Analyst

LPL Financial's $1.5 billion stock offering (4,687,500 shares at $320.00) represents a calculated move to fund its Commonwealth Financial Network acquisition. The pricing shows only a 2.2% discount to current market value, suggesting strong market confidence despite the dilutive effect. This structure indicates the company is raising capital from a position of strength rather than necessity.

The additional 703,125 share option for underwriters could potentially increase the capital raise by approximately $225 million if fully exercised. The impressive underwriter lineup led by Morgan Stanley with support from major institutions like Goldman Sachs and Citigroup further validates market interest in LPL's expansion strategy.

While secondary offerings typically raise dilution concerns, this capital allocation demonstrates disciplined execution of LPL's growth roadmap in the wealth management space. The company already manages approximately $1.7 trillion in assets and supports nearly 29,000 financial advisors across 1,200 financial institutions, providing services to approximately 6 million Americans. This acquisition appears designed to strengthen LPL's market position as "among the fastest growing wealth management firms in the U.S."

The financing structure, combining this equity offering with "available cash and other borrowings," suggests a balanced approach to funding the acquisition without overleveraging the balance sheet. For investors, this offering represents a strategic investment in growth rather than a response to operational challenges.

M&A Specialist

LPL's Commonwealth acquisition demonstrates clear strategic alignment with the company's core business model, focusing on expanding its advisor network rather than diversifying into tangential services. By leveraging its existing infrastructure across a larger advisor base, LPL stands to benefit from improved economies of scale and enhanced competitive positioning in the advisor-mediated marketplace.

The decision to fund this acquisition through a combination of this equity offering, cash reserves, and additional borrowing indicates a thoughtful capital structure approach that balances growth funding with financial flexibility. The $1.5 billion equity component suggests this is a substantial acquisition that could meaningfully accelerate LPL's growth trajectory.

As industry consolidation continues in wealth management, scale increasingly drives competitive advantage through technology investment capacity, improved economics with product partners, and broader service capabilities. LPL's move to expand beyond its current base of 29,000 advisors and $1.7 trillion in assets positions the company to potentially capture greater market share in the competitive wealth management landscape.

The well-coordinated announcement with a clear financing plan and defined closing timeline (April 2, 2025) demonstrates operational discipline in execution. For LPL stakeholders, this acquisition represents a significant milestone in the company's stated growth objectives, potentially strengthening its position among the fastest-growing wealth management firms in the U.S. market.

SAN DIEGO, March 31, 2025 (GLOBE NEWSWIRE) -- LPL Financial Holdings Inc. (NASDAQ: LPLA) (together with its subsidiaries, including LPL Financial LLC, “LPL Financial” or “LPL”) today announced the pricing of an underwritten public offering of 4,687,500 shares of its common stock at a price to the public of $320.00 per share. LPL also granted the underwriters a 30-day option to purchase up to an additional 703,125 shares of its common stock at the public offering price, less underwriting discounts and commissions. The offering is expected to close on April 2, 2025, subject to satisfaction of customary closing conditions.

Morgan Stanley & Co. LLC is acting as sole active book-running manager for the offering. BofA Securities, Inc., Citigroup, Citizens JMP Securities, LLC, Goldman Sachs & Co. LLC, BTIG, LLC and Truist Securities, Inc. are acting as joint book-running managers for the offering. M&T Securities, Inc., Capital One Securities, Inc., Huntington Securities, Inc., Barclays Capital Inc., CIBC Capital Markets, Wolfe | Nomura Alliance, Keefe, Bruyette & Woods, A Stifel Company, Rothschild & Co US Inc., William Blair & Company, L.L.C., Academy Securities, Inc. and Samuel A. Ramirez & Company, Inc. are acting as co-managers for the offering.

LPL intends to use the net proceeds of this offering to fund a portion of the cash consideration payable in connection with its previously announced proposed acquisition of Commonwealth Financial Network (the "Transaction") and, to the extent that any proceeds remain thereafter, or if the Transaction is not completed, for general corporate purposes. In addition to the net proceeds from this offering, LPL expects to use available cash and other borrowings to fund the purchase price for the Transaction.

The securities described above are being offered by LPL pursuant to its shelf registration statement on Form S-3 that was previously filed with the Securities and Exchange Commission (the “SEC”), which became effective on March 25, 2025. A preliminary prospectus supplement and accompanying prospectus relating to the proposed offering has been filed with the SEC and a final prospectus supplement relating to the proposed offering will be filed with the SEC and will be available on the SEC’s website located at http://www.sec.gov. Copies of the preliminary prospectus supplement, the final prospectus supplement and accompanying prospectus relating to the proposed offering may also be obtained, when available, from Morgan Stanley & Co. LLC, Attention: Prospectus Department, 180 Varick Street, 2nd Floor, New York, NY 10014, or email: prospectus@morganstanley.com. Before you invest, you should read the prospectus in the shelf registration statement and the prospectus supplement for more complete information about LPL and the offering.

This press release is neither an offer to sell nor a solicitation of an offer to buy any of the common stock or any other security of LPL, nor shall there be any sale of the common stock in any jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

“Wolfe | Nomura Alliance” is the marketing name used by Wolfe Research Securities and Nomura Securities International, Inc. in connection with certain equity capital markets activities conducted jointly by the firms. Both Nomura Securities International, Inc. and WR Securities, LLC are serving as underwriters in the offering described herein. In addition, WR Securities, LLC and certain of its affiliates may provide sales support services, investor feedback, investor education, and/or other independent equity research services in connection with this offering.

About LPL Financial
LPL Financial Holdings Inc. (Nasdaq: LPLA) is among the fastest growing wealth management firms in the U.S. As a leader in the financial advisor-mediated marketplace, LPL supports nearly 29,000 Financial Advisors and the wealth management practices of approximately 1,200 financial institutions, servicing and custodying approximately $1.7 trillion in brokerage and advisory assets on behalf of approximately 6 million Americans. The firm provides a wide range of advisor affiliation models, investment solutions, fintech tools and practice management services, ensuring that Advisors and institutions have the flexibility to choose the business model, services, and technology resources they need to run thriving businesses.

Securities and advisory services offered through LPL Financial LLC, a registered investment advisor and broker-dealer, member FINRA/SIPC.

Throughout this communication, the terms “Financial Advisors” and “Advisors” are used to refer to registered representatives and/or investment advisor representatives affiliated with LPL Financial LLC.

Forward-Looking Statements
Certain of the statements included in this release, such as those regarding the timing of completion of the offering and the anticipated use of proceeds therefrom, constitute forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Words such as “expects,” “believes,” “anticipates,” “plans,” “assumes,” “estimates,” “projects,” “intends,” “should,” “will,” “shall” or variations of such words are generally part of forward-looking statements. Applicable risks and uncertainties include those related to market conditions and satisfaction of customary closing conditions related to the proposed public offering. There can be no assurance that we will be able to complete the public offering on the anticipated terms, or at all. Certain additional important factors that could cause actual results or the timing of events to differ, possibly materially, from expectations or estimates expressed or implied in such forward-looking statements can be found in the “Risk Factors” section included in LPL Financial’s most recent Annual Report on Form 10-K. Except as required by law, LPL Financial does not undertake to update any particular forward-looking statement included in this document as a result of developments occurring after the date of this press release.

Contacts

LPL Media Relations
media.relations@lplfinancial.com

LPL Investor Relations
investor.relations@lplfinancial.com

FAQ

What is the price per share for LPL Financial's (LPLA) common stock offering in March 2025?

LPL Financial priced its common stock offering at $320.00 per share.

How many shares is LPL Financial (LPLA) offering in its March 2025 public offering?

LPL Financial is offering 4,687,500 shares, with an additional 30-day option for underwriters to purchase up to 703,125 shares.

What will LPL Financial (LPLA) use the proceeds from its 2025 stock offering for?

The proceeds will primarily fund the cash consideration for the proposed acquisition of Commonwealth Financial Network, with remaining funds for general corporate purposes.

When is LPL Financial's (LPLA) March 2025 stock offering expected to close?

The stock offering is expected to close on April 2, 2025, subject to customary closing conditions.

How many assets does LPL Financial (LPLA) currently manage as of March 2025?

LPL Financial services and custodies approximately $1.7 trillion in brokerage and advisory assets.