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Piper Jaffray brokers deal for Sandler O’Neill
Posted on Tuesday, 09 July 2019 13:07
Piper Jaffray is taking full control of Sandler O’Neill + Partners for USD 485.00 million to break into the field of advising financial institutions and investors on mergers and acquisitions (M&A), equity offerings and debt issuances.

The consideration comprises USD 350.00 million in cash and USD 135.00 million in restricted stock, as well as an additional issue of USD 115.00 million in long-term retention incentives, mainly in restricted scrip, to incoming employees.

It was noted the price is based on a USD 100.00 million tangible book value on the balance sheet of the 31-year-old company, billed as a leading investment bank focused on the financial services industry.

Founded in 1988, Sandler O’Neill has advised on more M&A transactions in this sector than any other player every year since 2012, having worked on 498 financial services deals with an aggregate deal value of USD 124.00 billion.

The group is also first in equity and debt capital offerings for financial institutions by helping clients raise more than USD 100.00 billion in the last seven years.

It has had six consecutive years of revenue growth – amounting to USD 343.00 million in 2018 (2017: USD 336.00 million; 2016: USD 300.00 million; 2015: USD 284.00 million; 2014: USD 262.00 million; 2013: USD 260.00 million) - driven by increasing market share.

Piper Jaffray noted the acquisition, which paves the way for a combined entity called Piper Sandler Companies, accelerates its goal of prioritising and building its M&A advisory business.

The deal also “adds a differentiated fixed income business and significantly expands the breadth and depth of the firm’s equity research, and sales and trading franchise”.

On a pro forma basis, Piper Sandler had advisory services revenue of USD 573.00 million and investment banking turnover of USD 839.00 million in 2018.

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