The range of advisors receiving these retention award offers is considerably wider than industry norms. We are offering five graduated levels of awards based on annual production, beginning with advisors whose trailing 12-month production is at least $300,000. We believe that the retention being offered to Morgan Keegan advisors is similar to retention offers in recent industry transactions of this type. While industry norms suggest that retention offers are made only to advisors with more than $500,000 in production, Raymond James and Morgan Keegan managements have determined to offer retention to advisors with $300,000 or more in gross production.
Is $500,000 the industry standard, as he says? I’m not privy to details of similar deals, but if it is, sounds generous. The firm has said that in addition to the cash award, they’ll also be eligible for other benefits including profit sharing, stock ownership, 401(k), and stock purchase plans.
Raymond James has not been shy about its intentions with Morgan Keegan folks. It’s like a dating relationship; the more flowers and chocolates they can provide, the better. The firm has said it plans to offer $215 million in retention payments to Morgan Keegan reps and some management. On top of that, Morgan Keegan has also set aside an undisclosed amount for advisor retention.
Ray Jay has invited 75 of Morgan Keegan’s top advisors and management to its St. Petersburg headquarters next week, and the retention awards will be paid within two weeks of the closing of the deal, which is expected for April 1. Letters to the lucky advisors, those offered an award, went out Wednesday.