New York-based financial services provider INTL FCStone has agreed to acquire Sterne Agee’s correspondent securities clearing and independent wealth management operations.
The deal, which is subject to regulatory approval, includes the acquisition of three broker dealer entities and two registered investment adviser entities.
The transaction’s value will be almost equal to the tangible net asset value of the combined operations, INTL said.
INTL securities division head Charles Lyon said that the acquisition will add $11bn in client assets, over 100,000 accounts and 50 correspondent clearing relationships to the firm’s portfolio.
"The Sterne Agee clearing business is a well-respected franchise that provides us with a strong platform to grow our clearing and related securities activities. The independent wealth management business provides us with an excellent foothold in a segment of retail wealth management that is growing and should lead to additional opportunities in that space," Lyon said.
INTL expects the acquired entities to generate a non-material loss in the first year following takeover and be accretive in the second year.
Moreover, INTL will retain the existing management and employees of the acquired units. The businesses operate with about 160 people in Alabama, North Carolina and Ohio.