The Press and Journal (Inverness, Highlands, and Islands)
Investment bank snapped up in $90m US deal
Piper Jaffray buys investment bank
The boss of investment bank Simmons & Co said yesterday its £90million takeover byUS-based Piper Jaffray was a “good time for change” after discussions saw a deal agreed in only four weeks.
Simmons chief executive ColinWelsh, who heads up the firm’s eastern hemisphere business, said the move was a great opportunity as it looks to continue expanding in regions including the Middle East and Asia.
Simmons, which specialises in the energy industry, is headquartered in Houston but has a major presence in Aberdeen.
The deal consists of £60million in cash and £30million in restricted stock.
Piper Jaffray has also committed a further £ 14million in cash and stock for retention purposes.
The agreement is also expected to result in threeUSbased Simmons’ partners leaving the company.
Talks between Piper Jaffray and Simmons have continued on-and-off for years, but Welsh said discussions between both sides had only intensified in the past month before the acquisition was confirmed.
Mr Welsh said: “It was really something that has been cooking, if you like, for quite some time really and the transaction is completely unrelated to the movement in the crude price.
“Although, that said, history tells us that most transactions that are done in a downturn tend to be some of the more successful ones. I really hope that this follows that pattern.
“It wouldn’t have been any good for us if we had got swallowedupby a giant investment bank that was driven out of New York because the culture that’s in those investment banks is very different to the culture in our business.
“I’m superhappyabout it because, basically, it’s like having your cake and eating it, really. The reality is that it’s a good time for change and it’s a great opportunity for us to move the business forward with partners that are very supportive of what we’re trying to do and who, candidly, have no desire to interfere with how we do things unless they think it’s going to improve the business.”
Mr Welsh said the plan was to continue developing the firm, adding that it was busy working on lots of projects at present.
He said: “In the short term we want to get as many of those projects over the finishing line as possible and in the longer term we would like to continue to develop our activities in theMiddle East and inAsia and in Australia because a lot of our backlog comes not just from Aberdeen, not just from the UK, but from those regions as well and we want to continue developing our business in that way. This deal positions us perfectly to do that.”
The move means Welsh will become head of international energy investment banking and executive chairman of Piper Jaffray’s UK subsidiary.
He will also continue to lead Simmons’ international activities.
Piper Jaffray will continue to operate the business under the Simmons brand as a Piper Jaffray company.
Welsh added: “It’s been interesting being the guys in the middle of the deal rather than advising. It really is just business as usual.”
“Most transactions that are done in a downturn tend to be successful”