Seaport Group LLC, the credit-market brokerage founded in 2001, agreed to merge with boutique investment bank Global Hunter Securities LLC to create a full-service firm with more than 300 employees.
The deal between the two closely held companies is expected to be completed in the fourth quarter, and Mike Meagher, 57, and Daniel Conwill, 52, will serve as co-chief executive officers of the combined entity, Seaport and New Orleans-based Global Hunter said in an e-mailed statement. Terms of the merger, set to be announced later today, weren’t disclosed.
The agreement unites two firms that have grown since the financial crisis. Meagher and Stephen Smith, 53, started New York-based Seaport as a distressed-debt broker, while Global Hunter was founded in 2005 by Jefferies Group Inc.’s Conwill to focus on advising natural-resources companies.
“Our new firm will be one of the few genuinely full-service boutique investment banks able to offer clients advisory, sales and trading services across all products and markets,” Meagher said in the statement. “Now more than ever clients want to work with independent firms with client focus and best execution as their key values.”
Seaport’s merger gives it access to other capital-markets businesses as rival small bond-trading firms consolidate or shut amid fixed-income volume that’s failed to keep up with the market’s expansion.
CRT Capital Group LLC, a brokerage backed by Aquiline Capital Partners LLC, is in talks to combine with Pierpont Securities LLC, according to a person with knowledge of the matter. Gleacher & Co. said in April it was closing its fixed-income unit and Knight Capital Group Inc. agreed to sell its debt-brokerage to Stifel Financial Corp.
The combined firm of Seaport and Global Hunter will have headquarters in New York and New Orleans, with plans to expand research to more than 300 covered companies, according to the statement. The new entity, whose name has yet to be determined, generated $150 billion in fixed-income transactions and $30 billion in advisory mandates during the past three years.
Seaport has about 200 employees who trade bonds, private placements and structured products, according to its website, compared with fewer than 60 in 2008. Drew Doscher, 44, the firm’s co-head of sales and trading with Michael Meyer, 48, left in January.
Doscher said he filed an arbitration claim with the Financial Industry Regulatory Authority seeking $15.5 million in unpaid compensation. Lisa Weiss, a Seaport spokeswoman, declined to comment on the Finra claim.
Sea Port Group Securities LLC, the company’s brokerage division, earned $1.52 million from $85.6 million of revenue in 2012, according to a regulatory filing. That’s up from $29.8 million of revenue in 2008.
Global Hunter, which focuses on energy and shipping industries, has advised on deals such as Meidu Holdings Co.’s purchase of Woodbine Acquisition LLC last month for $135 million. Global Hunter added high-yield bond salesmen in recent years to bolster its position in managing debt sales, particularly among middle-market clients.