Mizuho Financial Group Inc (8411.T) will buy U.S. M&A advisory firm Greenhill & Co Inc (GHL.N) for $550 million including debt, the companies said on Monday, as Japan's No. 3 lender eyes a bigger share of the world's largest investment-banking fee pool.
Greenhill shares more than doubled to close at $14.66 on Monday after the announcement, just below the offer price of $15 per share.
Monday's boost helped Greenhill shares erase their losses accumulated over the last 12 months due to the impact of higher interest rates on deal-making. The stock was priced at $20 in its 2004 initial public offering.
The Greenhill business will sit within Mizuho's banking division, led by Michal Katz, head of banking in the Americas. Its chairman and CEO, Scott Bok, will become chairman of the M&A and restructuring advisory business.
"We have a strong M&A practice in Japan. But it's really early days here in the U.S. and in the other regions. So this is a way for us to scale in a meaningful way," Jerry Rizzieri, president and CEO of Mizuho Securities USA, told Reuters in an interview.
Mizuho has doubled down on U.S. debt underwriting since its 2015 acquisition of Royal Bank of Scotland's North American corporate loan portfolio, leaving M&A advisory and equity underwriting as areas targeted for further growth.
Last year, it bought Texas-based private equity placement agent Capstone Partners.
Other Japanese banks have also been expanding their foothold in the United States.
Mizuho's bigger rival Sumitomo Mitsui Financial Group (8316.T) in April announced it would boost its stake in U.S. investment bank Jefferies Financial Group Inc (JEF.N) from 4.5% to as much as 15%.
Yoshiro Hamamoto, CEO of Mizuho's brokerage arm, last year told Reuters that the group "has room for further growth" in the United States and that acquisitions were an option it was exploring.
Greenhill was founded in 1996 by former Morgan Stanley executive Robert Greenhill.
