IFMI takes major stake in PrinceRidge, capital markets teams to merge

By Susanna Moon

Chicago, April 19 - Institutional Financial Markets, Inc. said it agreed to join forces with PrinceRidge Holdings LP, merging part of the two companies' capital markets operations and bolstering their capital base.

IFMI secured a majority equity stake in PrinceRidge under an agreement to contribute the equity interests in a subsidiary comprising a substantial part of its capital markets segment. The total book value of the equity interests and cash to be contributed by IFMI to PrinceRidge is $45 million.

"With PrinceRidge's leadership and combined businesses, we will increase our capital base and effectively double our team of capital markets professionals," Daniel G. Cohen, chairman and chief executive officer of IFMI said in a press release.

PrinceRidge's John P. Costas, chairman, and Michael T. Hutchins, chief executive officer, will continue in their roles at the New York-based financial services firm, which consists of a sales and trading group specializing in structured products and corporate credit, and an investment banking group concentrated on corporate finance.

Before joining PrinceRidge, Costas held various jobs at UBS, including stints as deputy CEO of UBS AG, chairman and CEO of UBS Investment Bank, and chairman and CEO of Dillon Read Capital Management LLC.

Hutchins also worked for UBS before founding PrinceRidge, as global head of the fixed-income rates and currencies group at UBS Investment Bank and, most recently, he was president of Dillon Read Capital Management LLC.

Cohen will become vice chairman, chief investment officer and managing director of structured products for PrinceRidge.

JVB Financial Group, LLC, which was recently acquired by IFMI, is not included in the deal. JVB operates as an investment firm specializing in the wholesale distribution of fixed income securities such as CDs, MBS, agency securities, corporates, municipals and structured products.

IFMI also announced an amended employment arrangement with Chris Ricciardi, who will remain as the president of IFMI through a transition period but will no longer serve as CEO of IFMI's capital markets division.

The PrinceRidge transaction is subject to review by the Financial Industry Regulatory Authority.

IFMI is an investment firm specializing in credit-related fixed-income investments and is based in Philadelphia.

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