A subsidiary of Toronto Dominion Bank has agreed to buy Kennedy, Cabot & Co., a California discount brokerage firm, for a reported price tag of $155 million.
The deal by Toronto Dominion's Waterhouse Securities Inc. discount brokerage unit, announced Wednesday, would give the Canadian bank a firmer toehold in the securities discounting business in the United States. Toronto Dominion made its first cross-border foray in 1996 when it bought New York-based Waterhouse.
"The opportunity with Kennedy Cabot was a very strong regional presence in probably the best market" in the United States, said Duncan Gibson, executive vice president of wealth management at the bank. Toronto Dominion would add 15 branches-14 in California, one in Seattle-to Waterhouse's existing 102-branch network, he said. Under the deal, the bank increases its U.S. account base by 25%, he added.
Mr. Gibson declined to confirm the price to be paid for the privately held Kennedy Cabot. The deal is expected to close by yearend, pending regulatory approval.
Toronto Dominion would face tough competition from its U.S. peers, notably Fleet Financial Group, which last month agreed to pay $1.6 billion for Quick & Reilly Group.