"

Estimated reading time: 1 minute, 51 seconds

National Holdings Buys GilmanCiocia

national holdingsGilmanCiocia, which has had trouble growing revenue, is being acquired by another financial planning company, National Holdings Corp. The deal’s value is about $6.7 million, based on the National Holdings’ recent stock price of 28 cents per share.

Gilman shareholders will receive up to 24 million shares in National Holdings common stock, which will assume up to $5.4 million in Gilman debt, which it said would be repaid about the time of the closing. The deal is being accounted for as a merger.

National's CEO Mark Klein said in a conference call that one benefit National gets is Gilman’s tax preparation business, which is in line with his company’s desire to diversify and expand revenue. Klein said the deal makes National a one-stop provider of brokerage, financial planning tax preparation, as well as investment banking corporate finance support to small and mid-cap clients National intends to continue expansion of its offerings.

National itself recapitalized via an $8.8 million private sale of common stock in January with about $2.8 million used to pay debt. Klein was selected as CEO at the same time.

National’s revenue for the 12 months trailing March 31 was $157 million, a 30-percent increase from $119 million a year earlier. RIA Assets also increase about 32 percent to $1.3 billion.  The acquisition of Gilman will enable National Holdings to increase its rep count to over 825 advisers, up from 680.

GilmanCiocia was exclusively a financial services company until it acquired tax preparation operations a few years ago to diversify its operations. For the third quarter ended March 31, Gilman had net income of $1.24 million, up from $287,000. Revenue dropped to $11 million from $12.3 million the prior year and both financial planning and tax preparation revenue were down.

National’s revenue for the half ended March 31 was $32.9 million, a 2.3-percent increase from $33.2 million a year earlier.  The company’s net income for the most recently ended half was $669,000, a wide swing from a loss of $1.7 million in last year’s corresponding period.

A portion of the savings came in a reduction in interest expense, which fell to $66,000, down from $276,000. The company also reduced occupancy, equipment and other administrative costs to $981,000 from $1.3 million. National attributed that to a reduction in the amounts paid for customer settlements and office rent.

Read 4473 times
Rate this item
(0 votes)

Visit other PMG Sites:

Template Settings

Color

For each color, the params below will give default values
Tomato Green Blue Cyan Dark_Red Dark_Blue

Body

Background Color
Text Color

Header

Background Color

Footer

Select menu
Google Font
Body Font-size
Body Font-family
Direction
PMG360 is committed to protecting the privacy of the personal data we collect from our subscribers/agents/customers/exhibitors and sponsors. On May 25th, the European's GDPR policy will be enforced. Nothing is changing about your current settings or how your information is processed, however, we have made a few changes. We have updated our Privacy Policy and Cookie Policy to make it easier for you to understand what information we collect, how and why we collect it.