Independent broker/dealer National Planning Holdings (NPH) has teamed up with FP Transitions to provide succession plannning and practice acquisition services for its representatives. NPH, based in Santa Monica, Calif., is the nation's seventh-largest independent broker/dealer network. Portland, Ore.-based FP Transitions provides transition and succession planning services for the financial services industry.
The deal arose after NPH reps increasingly asked for help in acquiring other practices and showed more interest in planning their own transitions. "The whole practice management piece, which includes succession planning, is a big initiative with us this year," says Lynn Niedermeier, president and chief executive officer at INVEST Financial Corp., a Tampa, Fla. outfit that's one of four companies in the NPH network. "FP Transitions is the only one in the game that lists practices for sale and is the only one providing knowledge and the networking piece."
FP Transitions' services include buy-sell and continuity agreements, emergency and disaster planning programs, internal succession plans, and third-party practice sales.
Niedermeier says FP Transitions will provide the expertise, and that NPH will help finance acquisitions by its reps. "We have a big enough network of 2,800 reps to be in the position to help them buy other practices and keep it in our family," she says.
Banks are often reluctant to lend to very small business practitioners who want to buy other small practices, says Niedermeier, adding that NPH is in the process of putting together an acquisitions program that will pay a major portion of a down payment, with the rest paid through an earn-out.
"We would help finance that, and the rep would pay us back over five to seven years," she says. "We would make it a lot easier for them to buy a practice than if they did it themselves."