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Jefferies Increases KCG Stake by 49% to 16.5 Million Shares

KCG was formed when Chicago-based Getco LLC bought Knight Capital Group Inc. Photographer: Jin Lee/Bloomberg
KCG was formed when Chicago-based Getco LLC bought Knight Capital Group Inc. Photographer: Jin Lee/Bloomberg

Dec. 6 (Bloomberg) -- Jefferies Group LLC, the investment bank owned by Leucadia National Corp., increased its stake in KCG Holdings Inc. by 49 percent, more than a year after helping to rescue the market maker.

Jefferies held 16.5 million shares, or about 14 percent, of Jersey City, New Jersey-based KCG as of Nov. 25, according to a regulatory filings. New York-based Jefferies held 11.1 million shares at the end of September, according to an earlier filing.

KCG was formed when Chicago-based Getco LLC bought Knight Capital Group Inc. Getco and five other financial firms received Knight preferred shares in August 2012 as part of a deal to rescue the market maker after it spewed erroneous orders that caused more than $460 million in losses. Jefferies had converted its preferred stake for common equity before the additional investment disclosed yesterday.

KCG climbed 2.2 percent to close at $11.55 today in New York. At that price, Jefferies’s stake is valued at $190.2 million. Richard Khaleel, a Jefferies spokesman, declined to comment on the company’s stake in KCG.

To contact the reporters on this story: Laura Marcinek in New York at lmarcinek3@bloomberg.net; Stephanie Ruhle in New York at sruhle2@bloomberg.net

To contact the editor responsible for this story: Peter Eichenbaum at peichenbaum@bloomberg.net

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