Power base shifting to East, Jefferies' L.A. future cloudy. (Wall Street West).

WITH a new East Coast-based chairman, a $500 million shelf registration and the ever-present lure to either bulk up or merge, how long will Jefferies Group Inc. remain an L.A. fixture?

This week, Frank Baxter, 65, steps down as chairman after taking the reins from founder Boyd Jefferies in 1989. Started in 1962, the firm originally was a 24-hour trading desk for institutions that wanted to trade "jumbo" blocks of stock off the exchanges. Over the years Jefferies has grown into a 1,500-person full-service brokerage that now has more employees in New York and its environs than in Los Angeles.

Chairman-to-be Richard Handler works in the Stamford, Conn. office and the brokerage's president, John Shaw, works in New York. "For all intents and purposes, the headquarters is in New York," said Jefferies spokesman Tom Tarrant, who himself is based in New Jersey. "But we do keep an investment banking and trading desk in Los Angeles."

Jefferies is a perennial topic of takeover speculation, and those questions were again asked by analysts in a conference call two weeks ago, especially with that $500 million debt and equity shelf registration filed in late January. To what purpose is Jefferies raising money?

Tarrant isn't saying. "We said in the call that the new capital will retire some old debt and also give us the flexibility for any or all opportunities in the future."

Jefferies' stock has risen 36 percent in the last year, while the industry in general has foundered. The rise suggests traders expect a larger outfit to snap up Jefferies.

It's worth noting that Cantor Fitzgerald, the bond trading house started in Beverly Hills after World War II by founder Bernie Cantor, migrated in stages to New York in the late 1990s, where it is now based.

Baxter is a longtime Angeleno involved in civic causes (an active marathoner, he likes to jog the stairs between Jefferies floors). Handler has no ties to Los Angeles and lives in the N.Y. suburbs.

Contributing columnist Benjamin Mark Cole writes about the local investment community for the Los Angeles Business Journal. His new book is "The Pied Pipers of Wall Street: How Analysts Sell You Down the River," published by Bloomberg Press. He can be reached at [e-mail].