Jefferies Financial Group and SMBC Group expanded their global strategic alliance to enhance collaboration on future corporate and investment banking business opportunities within the Canadian market.

In December 2023, Jefferies established full-service investment banking and capital markets capabilities in Canada, opening a new 40-plus person office with dedicated expertise across investment banking, equity research, and sales and trading in all sectors. Jefferies will now align its M&A, leveraged finance and equity capital markets knowledge in Canada with SMBC Group’s banking and debt capital markets experience and balance sheet to support and serve clients.

The SMBC-Jefferies strategic alliance commenced in 2021, focused on U.S. leveraged finance and Japan cross-border M&A. In 2023, it was expanded in the U.S. to broaden the scope of collaboration in M&A advisory services, increase collaboration across the firms’ equities and debt capital markets businesses, and launch a joint coverage model for designated investment grade clients. In January, the alliance was further extended to cover Europe, the Middle East and Africa (EMEA).

In support of the initial strategic alliance in 2021, SMBC provided $2.25 billion in financing to Jefferies and purchased approximately 4.5% of the outstanding common shares of Jefferies. In April 2023, the alliance was further bolstered when SMBC announced plans to raise its economic ownership to up to 15% on an as-converted and fully diluted basis, which would result in SMBC becoming Jefferies’ largest shareholder.

“In just the first few months since opening Jefferies’ new Canada office, we have already witnessed the benefits that the Jefferies-SMBC strategic alliance will bring to our valued clients,” Bruce Rothney, CEO of Jefferies Canada, said. “SMBC’s capital base and world-class capabilities will enable us to jointly offer comprehensive, full-service solutions to our clients in Canada. We are excited by the opportunity to accelerate efforts with our partners at SMBC as we pursue our mission of establishing Jefferies as a leading full-service global investment banking and capital markets firm in Canada.”

“Adding another region to SMBC’s strategic alliance with Jefferies builds on our initial success as global partners,” Takeshi Okamoto, general manager of SMBC Canada, said. “We look forward to better serving our Canadian clients through the combined power of Jefferies’ and SMBC’s strengths in global investment banking and corporate banking, and are eager to continue expanding our alliance.”