LOUISVILLE — Bowling Green’s Houchens Industries will acquire Louisville-based brokerage and financial services provider Hilliard Lyons in a deal announced this morning at Hilliard Lyons’ headquarters at PNC Bank Plaza.

Terms of the deal were not disclosed. Closing of the transaction is set for the first quarter of 2008.

Houchens officials said Hilliard Lyons will keep its name, 525 employees, management team and headquarters in the Louisville area. The company has around 500 employees elsewhere at its 76 branches throughout Kentucky and 11 states, including an office in Bowling Green.

Details of the deal have not been finalized, but Houchens President Spencer Coates said the acquisition will create additional employment opportunities for Bowling Green’s Hilliard Lyons office and likely accelerate growth for Houchens’ insurance market.

Coates said as a longstanding client of Hilliard Lyons, Houchens was already familiar with its management and organization – key factors in the deal.

“That’s what attracted us,” Coates said.

Coates said the deal marks a bright spot in Houchens’ 90-year history, rising from a grocery store in Glasgow to a conglomerate that is the nation’s largest employee-owned company.

The deal means PNC Financial Services Inc. will phase out its nine-year ownership of Hilliard Lyons, according to James Allen, chairman and CEO of Hilliard Lyons.

“Hilliard Lyons and PNC’s strategic plans are taking them in a different directions. PNC is currently focused on developing its banking resources and Hilliard Lyons is not in PNC’s strategic footprint to any great extent,” Allen said. But Hilliard Lyons will continue providing clearing services for PNC Investments for the next two years, he added.

“We believe the proposed ownership, which will include employees of the company, provides Hilliard Lyons with a tremendous opportunity to chart a course for growth and success with the support of Houchens,” Allen said.

Once the sale is completed, Houchens will own Hilliard Lyons outright.

Coates said Houchens wants to work out an ownership arrangement in which Hilliard Lyons employees could have an equal share in the ownership of the firm, along with Houchens. He said details still have to be worked out.

Louisville Mayor Jerry Abramson praised the deal at today’s announcement, saying it prevented Hilliard from being sold off to an out-of-state company that could have moved headquarters out of the city.

It was the second big deal for Houchens this year.

Earlier, Houchens sold its Commonwealth Brands cigarette company to British-based Imperial Tobacco Group PLC in a $1.9 billion deal.

— The Associated Press contributed to this article.