INTL FCStone acquires Clearing and Wealth Management businesses from Stifel Financial’s Sterne Agee LLC

Commodities and Forex broker INTL FCStone Inc (NASDAQ:INTL) has announced that it has signed a definitive agreement with Sterne Agee LLC, a wholly-owned subsidiary of Stifel Financial Corp (NYSE:SF), to acquire Sterne Agee’s correspondent securities clearing business and the independent wealth management business. The transaction will involve the purchase of three broker dealer entities and two registered investment adviser entities. The closing of this transaction is subject to limited conditions including regulatory approval.

The purchase price will be approximately equal to the tangible net asset value of the combined businesses.  INTL projects that the acquired businesses will produce a non-material loss in the first year after acquisition and be accretive in the second year.

INTL will retain the current management and staff of the Sterne Agee businesses it is acquiring, which employ approximately 160 people in Birmingham, AL, Charlotte, NC and Youngstown, OH.

Sean O’Connor, CEO of INTL FCStone Inc., commented,

This acquisition fulfills a strategic objective allowing us to clear securities for our customers. We believe that the securities industry has rapidly consolidated, providing an opportunity for a well-capitalized, credible mid-market clearer.  This acquisition will allow us to provide execution, market intelligence and post trade clearing across almost all asset classes in almost every market.

Charles Lyon, head of INTL FCStone’s Securities Division, added, “This acquisition brings $11 billion in client assets, over 100,000 accounts and 50 correspondent clearing relationships to INTL.  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.”

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