UBS AG's decision to acquire PaineWebber Group in a pricey $10.8 billion cash and stock transaction shows just how valuable brokers and branches have become, even in the age of the Internet.

The deal brings to UBS - a global power in commercial and investment banking companies but until now a nonentity in the U.S. retail market - a footprint and name recognition that rivals any in the United States. A short supply of talent makes it almost impossible to assemble a network from scratch, while competitors across financial services are themselves girding for battle for high-net-worth retail customer dollars.

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