Stifel Financial (SF) in St. Louis has agreed to buy KBW (KBW) for more than $575 million in cash and stock.

KBW has taken steps to reduce its headcount as it has struggled the last two years. In 2011 it lost $31.7 million, and on Monday it announced that it had lost $5.2 million for the third quarter and $10.1 million for the first nine months of the year.   KBW’s Chief Executive Thomas Michaud told American Banker in the June that he wanted to “build the most valuable company I can. And if somebody chooses to acquire the company, I want to make sure they pay the highest and fairest price possible.”   New hires and preparations for an anticipated wave of bank mergers have fueled Stifel Nicolaus, the investment banking arm of Stifel Financial, having its best bank M&A results since 2007.

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