Cowen is to acquire Quarton International AG and affiliated Quarton entities (Quarton), a global financial advisory company serving the middle market.
The definitive agreement has been approved by Cowen’s board of directors and Quarton International’s shareholders and governing bodies. The transaction is expected to close by 2 January 2019.
Quarton International is the result of the 2015 merger of Switzerland- and Germany-based Blue Corporate Finance (founded 2001) and Detroit-based Quarton Partners (founded 2010), and has a team of 70 professionals across ten offices in Europe and the US. With its international expertise, extensive financial sponsor relationships and unique domain knowledge, especially in the industrial and technology verticals, Quarton has demonstrated significant success scaling its M&A, restructuring and financial advisory services in the worldwide middle market.
“The combination of Cowen and Quarton International creates a tremendous opportunity for our firms, our teams and especially our clients,” says Jeffrey M Solomon, Cowen’s Chief Executive Officer. “Quarton International’s significant advisory business to the middle market in Europe and the US complements Cowen’s existing merger advisory platform, as well as our breadth and strength in capital markets activities. Together, our two companies create a global, cross-border investment banking platform that is not only dedicated to helping our clients consistently outperform, but also provides greater scale and revenue diversification enabling us to achieve our targeted returns on equity on a more sustainable basis.”
Larry Wieseneck, Co-President of Cowen and Company, adds: “We are excited to welcome Quarton International’s impressive team to Cowen. Their focus and dedication to their clients have made them highly respected and preferred advisors in the middle market, especially in the private equity and family office communities. This aligns perfectly with recent initiatives at Cowen to more effectively deliver the full breadth of our capabilities to these critical investors and will enable us to provide our clients with strong cross-border expertise and access to public and private financing sources across the capital structure.”
Andre Augier, Chairman and CEO of Quarton International North America, and Andreas Kinsky, European Co-Founding Partner, say: “We are thrilled to be joining forces with Cowen. Its full-service platform of markets and investment banking services provides us with the scale and resources to continue growing our middle-market advisory business and creating outstanding value for the private equity firms and business owners we serve throughout Europe and the US Just as important, Cowen’s entrepreneurial spirit is a natural fit for the strong culture and unique approach we have built at Quarton International. We are all delighted to be joining the outstanding Cowen team.”
Under the definitive agreement, Cowen will acquire 100 per cent of Quarton International’s equity interests for upfront consideration of USD75 million, subject to net working capital and other customary adjustments as set forth in the definitive agreement, with additional contingent consideration of USD40 million that would become payable dependent on the achievement of certain performance milestones by Quarton International. In addition, Cowen has agreed with Quarton International to establish a retention bonus pool for Quarton International employees following the completion of the acquisition. All consideration, including pursuant to any employee retention program, is to be comprised of 80 per cent cash and 20 per cent Cowen Class A common stock.
Willkie Farr & Gallagher LLP served as legal advisor to Cowen. Freeman & Co. acted as financial advisor to Quarton International, and Debevoise & Plimpton as legal advisor to Quarton International.
