Jefferies Financial to sell OpNet to Wind Tre for €485m to advance investment banking focus

Jefferies Financial Group Inc. (NYSE: JEF), in line with its vision to become the premier independent global Investment Banking and Capital Markets firm, has entered into an agreement for the sale of OpNet S.p.A’s operations to Wind Tre S.p.A, a subsidiary of CK Hutchison Group Telecom Holdings Ltd. (CKHGT). This significant transaction, valued at €485 million, marks a pivotal step in Jefferies’ strategy to streamline its portfolio and reinforce its focus on core investment banking activities.

The sale, expected to close in the second or third quarter of 2024, is contingent upon regulatory approvals. The consideration includes a substantial cash payment to clear OpNet’s financial obligations, with approximately €225 million potentially paid in cash or, at CKHGT’s discretion, in three-year notes issued by CKHGT. This arrangement aligns with CKHGT’s existing investment-grade bonds and adds marketability to the deal. Furthermore, OpNet will maintain majority stakes in other telecom operations, culminating in a net value of approximately €320 million for Jefferies, surpassing its current carrying value of the assets.

This transaction follows Jefferies’ recent divestitures, including the sales of Foursight Capital LLC and Golden Queen, as part of its broader strategy to optimize and monetize its merchant banking assets. These moves underscore Jefferies’ commitment to reallocating resources towards its investment banking and capital markets endeavors.

With the transition of these legacy investments to “Other investments” within its Asset Management segment in fiscal 2024, Jefferies aims to concentrate on the core business of HomeFed and the strategic liquidation of peripheral assets. This shift marks a return to Jefferies’ foundational focus on investment banking excellence and capital market leadership.

Rich Handler, CEO of Jefferies, and Brian Friedman, President, have expressed their enthusiasm for this strategic realignment. Emphasizing the culmination of over a decade of diligent asset optimization and reinvestment into Jefferies, they highlighted the firm’s achievement in centering on its investment banking core. The collaboration with SMBC and the dedication of over 5,500 employee-partners worldwide have been instrumental in positioning Jefferies for sustained success and growth in the global investment banking arena.