Founder and President Edward Wedbush is in acquisition talks with 4 U.S. firms, while pursuing expansion in Poland and the U.K.  Already the largest U.S. West Coast brokerage and investment bank, Wedbush Securities stands to bolster its trade-processing capabilities and expand its presence in more U.S. markets by acquiring its targeted U.S. companies.  The transactions could be completed within 6 months.

The L.A.-based company also has plans to open trading and brokerage units in Poland and Britain, while expanding its U.S. private-client network by more than 70% to 600 brokers.  One objective of these moves is to put the closely-held firm in a better position to go public in 4-5 years, according to Mr. Wedbush.  Wedbush declined to elaborate on the potential deals, except to say they'd help to secure technology "essential to the core processing part of the business."

The Wedbush family owns 52% of the company;  the rest is held by employees, former employees and clients.  The company was founded in 1955.     

    Small Fish in Large Pond;  Largest Processor on Nasdaq.   With just 1,000 employees, balance sheet assets of $3.3 billion, and $42 million in pretax earnings for the JUne 2010 fiscal year, Wedbush is the largest processor of trades on Nasdaq.  It's also one of the few remaining West Coast securities firms - after decades of 'Wall Street' consolidation - and a company that thrived through the recent financial crisis.  The Wedbush family owns 52 percent of the company, with the remainder held by employees, former employees and clients.

The financial sector's recent strength in the markets, and the well-received IPOs of LPL Investment Holdings First Republic Bank have not swayed Mr. Wedbush's to accelerate his 4- to 5-year horizon for going public:  "The market for financial firms is still moderate to weak at best."  Wedbush first, would like to compliment its large and thriving trade-clearing business - correspondent services for other brokerages and sponsored access for high-frequency traders - by building out its private-client brokerage and capital markets businesses. 

Mr. Wedbush also wants the firm to be "firing on more cylinders" and have a "broader base of success, which would make us more attractive."  The firm also wants to grow financially, amassing a net worth of between $350mn and $500mn, up from today's $300mn. 

The firm intends to become a member of the Warsaw Stock Exchange, offering brokerage and trading services to clients throughout the European Union.  That work should be completed in a couple of months.  The company also is registering with Britain's regulators (Financial Services Authority) and intends to become a member of the LSE (London Stock Exchange).

Sounds like very exciting times for the firm.  Good luck.   [Reuters, 1/6]