Stifel Financial to Buy Knight Capital Unit

By FOXBusiness

Stifel Financial (NYSE:SF) said on Friday it will acquire Knight Capital Group’s (NYSE:KCG) U.S. institutional fixed-income brokerage business.

Stifel, a midsize broker that owns Stifel Nicolaus & Co., also announced it will hire Knight’s European institutional fixed-income sales and trading team.

Continue Reading Below

The firm expects to complete the acquisition and the hiring of the European team in the second quarter. Financial terms of the deal were not disclosed.

Combined, the U.S. and European units have about 100 sales and trading professional that cover emerging markets, asset-backed and mortgage-backed securities, high-yield and investment-grade corporate bonds and fixed income research in selected sectors and companies.

Stifel offers securities brokerage, investment banking and other services. It recently acquired financial-services firm KBW for more than $575 million.

“Expanding our fixed income business has been an initiative of ours,” Ronald J. Kruszewski, Chairman, President and CEO of Stifel Financial, said in a statement. “We continually evaluate opportunities to drive our growth and expand our product offerings to our clients. This addition is a continuation of that goal.”

Last month, Stifel announced fourth-quarter earnings that soared 48% on strong revenue growth.

Knight is set to be acquired by Getco, a Chicago trading firm, for a deal that was valued in December at $1.4 billion. About four months earlier, Knight lost $461 million when a software glitch led to erroneous trades.

Shares of Stifel were down 20 cents to $36.45 a share Friday morning, while Knight Capital was trading a penny lower to $3.73 a share.