Piper Jaffray Completes Sale of Its Private Client Services Branch Network to UBS; Announces Authorization of $180 Million Shar
14 August 2006 - 11:00PM
PR Newswire (US)
MINNEAPOLIS, Aug. 14 /PRNewswire-FirstCall/ -- Piper Jaffray
Companies (NYSE:PJC) announced today that it has completed the sale
of its Private Client Services branch network to UBS Financial
Services Inc., a subsidiary of UBS AG. The branch network consists
of financial advisors and branch support personnel in approximately
90 retail offices in 17 Midwest, Mountain and Western states. As
consideration for the sale, Piper Jaffray received approximately
$500 million in cash for the branch network and approximately $250
million for the net assets of the branch network. The agreement
provides for additional cash consideration of up to $75 million,
depending on performance of the transferred business; at present,
however, Piper Jaffray anticipates realizing only a minor portion,
if any, of such additional cash consideration. "We are pleased to
complete the sale of the Private Client Services branch network to
UBS, which has been an excellent partner through the transition --
further validating how our private clients will now be served by
the world's leading wealth management provider," said Andrew Duff,
chairman and CEO of Piper Jaffray. "The completion of the sale
allows us to focus our resources entirely on building the leading
middle market investment bank." The sale will result in after-tax
proceeds of approximately $510 million and an after-tax book gain
of approximately $170 million, net of restructuring and transaction
costs. With the proceeds, the company intends to enhance its
capital markets business, repay $180 million of subordinated debt
and repurchase up to $180 million of common stock. The board of
directors has authorized a $180 million share repurchase program
that may be executed now through Dec. 31, 2007, in the open market
or in privately negotiated transactions, including in part through
an accelerated share buyback. The reacquired common shares will be
held as treasury shares and may be reissued for various corporate
purposes. Piper Jaffray previously announced its new management
team that will lead the capital markets-focused firm: * Andrew
Duff, Chairman and Chief Executive Officer * Thomas Schnettler,
Vice Chairman and Chief Financial Officer * James Chosy, General
Counsel * Frank Fairman, Head of Public Finance Services * Todd
Firebaugh, Chief Administrative Officer * Ben May, Head of
High-Yield and Structured Products * Robert Peterson, Head of
Equities * Jon Salveson, Head of Investment Banking About Piper
Jaffray Piper Jaffray Companies (NYSE:PJC) is a leading middle
market investment bank and institutional securities firm, serving
the needs of clients since 1895. Piper Jaffray & Co., the
firm's principal operating subsidiary, provides a comprehensive set
of products and services, including equity and public finance
underwriting; mergers and acquisitions; equity and debt capital
markets; high-yield and structured products; institutional equity,
tax-exempt and taxable sales and trading; and equity and high-yield
research. The firm's equity business is focused on seven sectors of
the economy: alternative energy, business services, consumer,
financial institutions, health care, industrial growth and
technology. The firm's public finance business is principally
focused on five sectors of the tax-exempt market: state and local
governments, real estate and housing, health care, education and
hospitality. With headquarters in Minneapolis, Piper Jaffray has
approximately 1,000 employees in 19 states across the United States
and in London. For more information about Piper Jaffray, visit us
online at http://www.piperjaffray.com/ . Cautionary Note Regarding
Forward-Looking Statements Statements contained in this press
release that are not historical or current facts, including
statements about beliefs and expectations, are forward-looking
statements. Forward-looking statements involve inherent risks and
uncertainties, and important factors could cause actual results to
differ materially from those anticipated, including the following:
(1) unforeseen difficulties associated with the transaction,
including business disruption and loss of personnel, could cause
the transaction to be more expensive than anticipated and adversely
affect our results of operations and financial condition; (2) the
expected benefits of the transaction, including the growth of our
Capital Markets business, increased profitability and shareholder
returns, may take longer than anticipated to achieve and may not be
achieved in their entirety or at all; (3) strategies with respect
to the redeployment of transaction proceeds may take longer than
anticipated to be realized or may not be achieved in their entirety
or at all; (4) following consummation of the transaction we may be
subject to increased competitive pressures and experience increased
volatility in our financial results; and (5) other factors
identified under "Risk Factors" in Part I, Item 1A of our Annual
Report on Form 10-K for the year ended Dec. 31, 2005, and updated
in our subsequent reports filed with the SEC. These reports are
available at our Web site at http://www.piperjaffray.com/ and at
the SEC Web site at http://www.sec.gov/ . Forward-looking
statements speak only as of the date they are made, and we
undertake no obligation to update them in light of new information
or future events. Since 1895. Member SIPC and NYSE. DATASOURCE:
Piper Jaffray Companies CONTACT: Investor Relations, Jennifer A.
Olson-Goude, +1-612-303-6277, or Media Relations, Rob Litt,
+1-612-303-8266, both of Piper Jaffray Web site:
http://www.piperjaffray.com/
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