Jefferies Financial Group and Sumitomo Mitsui Financial Group (SMFG) are significantly expanding their global strategic alliance, unveiling a new joint venture in Japan alongside fresh financing commitments.
SMBC and Jefferies Deepen Alliance with Japan Joint Venture and $2.5bn Financing
The two groups, which first partnered in 2021 and extended their collaboration in 2023, will combine their wholesale Japanese equities and equity capital markets operations.
The joint venture, expected to launch in January 2027, will merge SMBC Nikko’s domestic strength and balance sheet with Jefferies’ global investor network and advanced trading technology.
The partners aim to become the leading provider in Japanese wholesale equities.
Beyond Japan, the alliance will extend to Europe, the Middle East and Africa (EMEA), where the firms will jointly originate, underwrite and execute syndicated leveraged loans for large sponsors.
The groups will also broaden coverage of larger global sponsors, offering combined investment and corporate banking services.
As part of the deal, SMBC intends to increase its economic stake in Jefferies from 15% to as much as 20% through open market purchases, although voting rights will remain below 5%.
In addition, SMBC will provide Jefferies with approximately $2.5 billion in new credit facilities to bolster collaboration in areas including EMEA leveraged lending, U.S. pre-IPO financing and securitisation.
Toru Nakashima, SMFG’s chief executive, said the move aligned both groups to “offer our clients the best financing and advisory solutions to meet their needs around the world.”
Jefferies’ chief executive, Rich Handler, and president Brian Friedman added that the expanded alliance created “exceptional value” for clients globally.
