Credit Suisse nears deal to buy Michael Klein advisory boutique - report
Credit Suisse is reportedly close to an agreement to buy Michael Klein’s advisory boutique after several rounds of tense negotiations.
Citing people briefed on the talks, Bloomberg reported on Monday that as part of the expected agreement that’s been hashed out in recent days, the bank will value the firm founded by the incoming head of its First Boston spinout at around a few hundred million dollars.
It was understood the Swiss bank engaged Deutsche Bank to provide a fairness opinion.
Credit Suisse, seeking to draw a line under years of losses and scandals, is carving out its deal-making businesses under a storied brand and tapping ex-Citigroup Inc. banker Klein to try to return them to their former glory.
An agreement can turn the focus for Klein to recruiting star dealmakers and talking with potential investors. The bank is understood to be gauging interest from private equity firms to take stakes or fund specific businesses such as leveraged finance.
According to Bloomberg, the deal is expected to allow M. Klein & Co. shareholders to take an eventual stake in First Boston using proceeds from the sale. Sources said Klein and top executives at Credit Suisse clashed in recent weeks over issues including the value of the boutique, with the two sides at one point hundreds of millions of dollars apart on its value.
It was understood the parties achieved a breakthrough last week after discussions between top Credit Suisse executives and Klein, and the tensions are said to have eased in recent days.