Private Equity Deals & Transactions

Stifel enters fundraising business via Eaton acquisition

The financial services company will acquire 100% of Eaton Partners and use its retail and high net worth distribution platforms to support some of the alternative funds Eaton raises.

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Stifel Financial, a US wealth management and investment banking firm, has entered into a definitive agreement to acquire placement agent Eaton Partners, it said.

Eaton’s relationships with private equity firms, hedge funds, high net worth family offices, and institutional investors provides a growth opportunity for Stifel, which is also acquiring Barclays Wealth Americas, Stifel said.

A person close to the matter told Private Equity International that this transaction would give Eaton a good source of potential clients via Stifel’s investment bank, private equity and hedge fund coverage groups.

After being approached by Stifel, Eaton decided that the investment firm would be a good cultural fit. The agreement was facilitated by the fact that Eaton would be able to keep its offices and name, the person said.

Following the transaction, Eaton’s clients will have access to research, mergers and acquisitions advice, prime brokerage services and other investment banking services provided by Stifel, the person said.

Stifel will support some of the alternative funds that Eaton is raising through its retail and high net worth distribution platforms, the person said.

“This strategic transaction brings together both companies’ middle-market clients looking to raise public or private capital,” Stifel co-president Victor Nesi said. “This combination also presents an opportunity to grow our core advisory business at a time when private companies are raising multiple rounds of private capital prior to an IPO or merger.”

Stifel does not currently own a fundraising business and will have acquired 100 percent of Eaton when the transaction closes, expected in early January.

Eaton has raised over $68 billion for 90 funds since it was founded in 1983 and anticipates $60 million in advisory revenue for 2015.

Stifel’s main advisor for the deal was its wholly-owned subsidiary Keefe Bruyette & Woods. Its legal advisor was Dechert. Freeman & Co. Securities advised Eaton and Debevoise & Plimpton served as Eaton’s legal advisor.