Two Southern California-based financial planning and brokerage firms said Tuesday that they will merge in a deal that will create one of the nation's largest independent firms in that field.
Financial Network Investment Corp., a Torrance-based concern with about 1,000 financial planners, said it agreed to acquire certain assets of American Pacific Securities Corp., a Pasadena-based firm with about 500 planners. The value of the deal was not disclosed, but it is believed to be between $2 million and $5 million.
The firms said the combination will create the nation's largest brokerage firm--as measured by number of registered salespeople--that is not controlled by an insurance company or other financial institution and that does not create the products it sells.
The combined firm will operate in 31 states with commission revenue of about $33 million, principally through selling mutual funds, limited partnerships and other investments to individual investors.
The deal will help achieve savings by combining sales forces and back-office processing functions, said Miles Z. Gordon, president of Financial Network. "It makes our (combined) firm extremely profitable, from two firms that were marginally profitable," he said.