SVB Financial Group has entered an agreement to sell its investment banking division, SVB Securities, to a group of its own bankers, including Jeffrey Leerink, and backed by funds managed by the Baupost Group. The bidder group, led by SVB Securities CEO Leerink, will acquire the investment banking business for a combination of cash, repayment of an intercompany note and a 5 per cent equity instrument.
Rename and Buyout
The division will be renamed Leerink Partners as part of the management buyout. The takeover will happen at the end of the month, pending court approval. MoffettNathanson, a research business owned by SVB Financial Group, was not part of the sale and will remain part of the group.
Restructuring and Future Growth
"This transaction is a significant milestone in SVB Financial Group’s strategic alternatives process," said Bill Kosturos, the Chief Restructuring Officer. The current management team believes that the transaction will preserve and enhance the value of the business. "Our management team’s significant capital investment, coupled with key backing we’ve received from The Baupost Group, is a testament to the long-standing reputation of our firm and our employees and the value of our services to our clients and the industry," Leerink said.