The loss of independence continues. Nathan & Lewis Securities, an independent financial services firmbased in New York City, has been acquired by insurer The New England.
The broker/dealer will add a brokerage element to the captured agent sales force of Boston-based The New England, which has 2,500 agents.
"We will remain a stand-alone," says Jay Lewis, chief executive of Nathan & Lewis. "The name will stay, the staff will stay, and Jay Lewis will stay." He says the deal was attractive because it will allow a sharing of technology as well as distribution. "We represent a distribution source they want to have access to: the independent contractor."
Nathan & Lewis has 900 affiliated brokers.
The New England has proprietary life, annuity and various other insurance products. Those products had been available through Nathan & Lewis prior to the deal, but Lewis sees a further sharing of distribution through each firm's broker/dealer.
At press time in early March, the deal was being finalized and was expected to be completed within 30 to 45 days.
Mark McGorry, a Nathan & Lewis affiliate with Braunstein McGorry & Co. in New York City, says he isn't anticipating any change. "I'm very positive because I know the way Jay works, and he has made it clear that the firm will keep its autonomy.
"If anything, financially it may help," McGorry adds. Because Nathan & Lewis is keeping its name and Lewis is remaining at the firm, McGorry doesn't see any exodus. "I did get a lot of calls from other firms when the deal was announced, but that was to be expected." Although the well-known name of The New England might help with some clients, concern over any proprietary product pushing is an issue, McGorry admits. "It doesn't fit with Nathan & Lewis, and I was told that it wouldn't be an issue; I would be stunned if that happened." McGorry doesn't rule out seeing a separate division of Nathan & Lewis set up to handle proprietary product sales, though. Still, he says, the fact that almost all of Nathan & Lewis' affiliates have their own name on the door says something. "It's important to them that we keep our independence, and it's important to us."
Numerous other independent financial planning firms have been acquired by larger insurance companies in recent years, including Aetna's acquisition of Financial Network Investment Corp. of Los Angeles, and Aegon's purchase of Atlanta-based Financial Services Corp.