Canada’s TD Bank to buy U.S. brokerage Cowen in $1.3 billion deal

(Reuters) -Canada’s Toronto Dominion Bank will buy New York-based boutique investment bank Cowen in a $1.3 billion all-cash deal to boost its presence in the high-growth U.S market.

Cash-rich Canadian banks have been on a shopping spree in the United States in recent months as they try to find growth away from their home turf where the Big Six banks already control nearly 90% of the market.

The deal announced on Tuesday values each share of Cowen at $39, representing a premium of nearly 10% to the company’s last closing price. Cowen shares rose 8% in premarket trading.

Cowen was founded more than a century ago and offers investment banking and brokerage services to its clients.

Earlier this year, TD signed its largest-ever deal when it agreed to buy regional U.S. bank First Horizon for $13.4 billion to expand in the southeastern region of the country.

The companies expect the deal to close in the first quarter of 2023.

(Reporting by Manya Saini in Bengaluru; Editing by Aditya Soni)