The Business Times – MIZUHO Financial Group is forging further into US investment banking through a deal to buy Greenhill . as it seeks to accelerate growth.
The Japanese banking giant agreed to buy Greenhill for US$15 a share in an all-cash transaction, which values the firm at US$550 million including debt, the firms said on Monday (May 22) in a statement. The lender will retain Greenhill’s leaders, including chief executive officer Scott Bok, who will be chairman of mergers, acquisitions and restructuring.
Mizuho joins its Japanese rivals to expand investment banking tie ups in the US – though goes a step further in making an acquisition. Sumitomo Mitsui Financial Group last month said it will expand a tieup with Jefferies Financial Group to boost US capital markets and M&A advisory businesses. Japan’s largest bank Mitsubishi UFJ Financial Group has a more than decade-old alliance with Morgan Stanley, a deal struck in the heat of the 2008 financial crisis.
The US$15 a share price represents a 121 per cent premium to where Greenhill’s stock traded at the close of Friday, before the deal was announced. Shares in the firm jumped 116 per cent to US$14.65 at 10:09 am in New York on Monday.
“The stock as recently as February was trading right around this price,” Jerry Rizzieri, the president and CEO of Mizuho Securities USA, said in an interview. “Regional banks are down 40 per cent, this stock has taken a pretty big drop,” he said. “We think we’re paying a fair price for a premium brand.”
The deal gives Mizuho another 370 employees, and Greenhill will continue to operate in 15 locations around the world. Most locations overlap with Mizuho’s existing locations except Melbourne and Stockholm, according to Rizzieri. Mizuho plans to complete the transaction by the end of the year, and the Greenhill business will be within Mizuho’s larger dealmaking division run by Michal Katz, head of banking in the Americas.
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