TD Bank to acquire American investment banking company Cowen for $1.3bn

Toronto-Dominion Bank (TD Bank Group) has agreed to acquire Cowen Inc., a publicly-listed American investment banking company, in an all-cash deal worth $1.3 billion or $39 per share.

The deal enables the Canadian banking group to grow its investment banking business and capabilities in the US.

Bharat Masrani — TD Bank Group President and CEO said: “Cowen is a leading independent dealer with a premier U.S. equities business and a strong, diversified investment bank that, when combined with TD Securities, will allow us to accelerate our strategic U.S. growth plans.

“Most importantly, the acquisition will provide new capabilities and increased depth in key business lines to meet our clients’ needs and will allow us to leverage our combined expertise, talent, and integrated offerings across a much larger client base.”

TD Bank to acquire American investment banking company Cowen for $1.3bn. Photo courtesy of Tdorante10/Wikimedia Commons.

Apart from investment banking, the New York-based Cowen provides research, prime brokerage, sales and trading, global clearing, outsourced trading, and commission management services.

The company, which was founded in 1918, also has an investment management unit which provides actively managed alternative investment products.

For making use of the strength of Cowen’s brand, after the closing of the deal, parts of the combined business will be branded as TD Cowen, a division of TD Securities, and will be headed by Jeffrey Solomon, who is currently the chair and CEO of Cowen.

Jeffrey Solomon said: “The strategic decisions and focused investments that we have made over the last few years have positioned Cowen for this exciting next chapter of our growth.

“I look forward to having our exceptional talent and valued clients join the TD family. We plan to do great things together because we are aligned with our cultural values of vision, empathy, sustainability, and tenacious teamwork.”

The deal has been approved by the boards of directors of the two parties.

It is subject to regulatory approvals in the US and Canada, Cowen’s stockholder approval, and other conditions, and is expected to be wrapped up in Q1 2023.