GMP Capital to sell capital markets business to Stifel Financial Corp.

Toronto’s GMP Capital has announced it is to sell its capital markets business to fellow financial services firm Stifel Financial Corp., of St. Louis, Missouri.

The move comes after a strategic review undertaken by GMP capital. The process resulted in a special committee comprised of the company’s board of directors recommending that the transaction would be in the best interests of the company.

Don Wright, Chairman of the Board and Special Committee at GMP, said: "Our capital markets business has been the core focus of our company offering great services and excellent execution to clients in select markets under the leadership of Harris Fricker and his talented team of investment professionals. The GMP Board's decision to sell this business reflects our belief that our clients and employees will enjoy substantial benefit from the expanded opportunities and necessary critical mass that a world class player like Stifel brings to the table. With this sale, the GMP Board intends to deploy the Corporation’s strong capital position to focus and invest heavily in wealth management where we see significant opportunities to partner with the Richardson family, our top performing investment advisors and management at Richardson GMP to create significant long term value for shareholders.”

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Stifel are to acquire the business for a cash sum based on the value of the company at the time of the transaction’s closing, as well as a flat figure of $45mn. In its press release, GMP said that as of April 30, 2019, the purchase price would have been approximately $70mn.

“The acquisition of GMP’s capital market business is the latest step in the build out of our premier middle market investment banking offering,” said Ronald J. Kruszewski, Chairman and CEO of Stifel Financial Corp. “Over the past 13 years, we have grown our annual institutional net revenues from roughly $60 million to more than $1 billion through a combination of strategic acquisitions and strong organic growth. The addition of GMP’s capital markets business further enhances our institutional business given its strength in the Canadian markets and within the technology, healthcare, cannabis and energy verticals.”