JPMorgan's Cazenove Deal Looks Smart
NEW YORK (TheStreet) -- JPMorgan Chase's (JPM) decision to buy out U.K. broker Cazenove looks like a smart move.
After days of speculation, JPMorgan Chase said Thursday it would acquire the remainder of the joint venture partner Cazenove that it doesn't already own for $1.67 billion (1 billion pounds). The firms partnered up at the beginning of 2005 with JPMorgan taking a 50.01% interest in Cazenove. Under the deal, JPMorgan will combine the joint venture's cash equities and research operations with its existing franchise in Europe, the Middle East and Africa, and run the business under the JPMorgan Cazenove banner. JPMorgan's international investment banking franchise "has become a lot stronger," says Jeffrey Harte, an analyst at Sandler O'Neill & Partners. "It's something you want to build on, not let slip away." The joint venture's corporate finance business has already been operating closely with JPMorgan Chase in the U.K. There should be "little change to its activities" as a result of the deal. JPMorgan Cazenove will remain focused on providing strategic advice to large and small U.K. clients, as well as raising capital and delivering risk management solutions. According to Dealogic, activity from JPMorgan Cazenove was already included in JPMorgan Chase's global investment banking rankings. Year-to-date, JPMorgan Chase already has the top ranking for global debt and equities capital market activities as well as global syndicated loans, in terms of value, according to Dealogic. It ranks No. 3 behind Goldman Sachs (GS) and Morgan Stanley (MS) respectively for total deal value for global M&A advisory, this year.- Loading Comments...
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