Photo by James Sanna | Banker & Tradesman staff
Providence-based Citizens Financial Group Inc. has agreed to acquire capital markets firm JMP Group LLC in a deal valued at $149 million.
Citizens said in a statement this morning that it would acquire the San Francisco-based JMP in an all-cash transaction. The deal is expected to close in the fourth quarter, and the boards for both companies have unanimously approved the deal.
JMP was founded in 1999 and provides investment banking services, including strategic advisory, equity research and sales and trading focused primarily on the healthcare, technology, financial services and real estate sectors, Citizens said in the statement. JMP will operate as a wholly-owned subsidiary of Citizens once the transaction is complete.
“The acquisition of JMP represents an attractive opportunity for us to continue to broaden both our capabilities and our customer base in our commercial banking segment,” Bruce Van Saun, chairman and Citizens’ chairman and CEO, said in the statement. “The acquisition further strengthens Citizens’ growing corporate finance and strategic advisory capabilities, with a focus on high growth and compelling industry sectors.”
Donald McCree, Citizens’ vice chairman and head of commercial banking, said the acquisition would give Citizens a strong platform based in San Francisco and New York and expand the bank’s range of services and national presence.
“We are adding a wealth of talented bankers as well as an institutional equities franchise that aligns well with our sector-focused corporate banking philosophy,” McCree said in the statement.
Executive management and members of JMP’s board of directors own approximately 60 percent of the firm’s outstanding common shares as of Sept. 1, according to the statement. The merger agreement calls for JMP shareholders to receive $7.50 for each common share they own, totaling approximately $149 million in cash.
JMP shareholders must approve the deal, and it is also subject to regulatory approvals and other customary closing conditions.
“Citizens takes an approach to business and client service that mirrors our own,” Joseph Jolson, JMP’s founder and chairman, said in the statement. “We are energized by the opportunity to provide new strategic advisory and equities capabilities to Citizens’ corporate client base while simultaneously offering JMP Securities’ clients a highly complementary set of products and services as part of a leading U.S. depository institution.”
Sullivan & Cromwell LLP was the legal advisor to Citizens for the transaction. Keefe, Bruyette & Woods, A Stifel Company, and JMP Securities LLC served as financial advisors to JMP. Mintz, Levin, Cohn, Ferris, Glovsky and Popeo P.C. was JMP’s legal advisor.
The deal with JMP adds to other moves Citizens has recently made. The bank is acquiring 80 of HSBC’s East Coast branches in a transaction that is expected to close in the first quarter of 2022. Citizens is also acquiring New Jersey-based Investors Bancorp Inc. in a $3.5 billion transaction involving cash and stock. That deal that is expected to close in the second quarter next year.
