SVB Financial Group, the owner of Silicon Valley Bank, has agreed to acquire Leerink, the parent company of Boston-based investment bank Leerink Partners, for $280m in an all-cash deal.
According to SVB Financial, the deal will help the company to complement its commercial banking and lending products with a range of investment banking services focused on healthcare and life science firms.
SVB Financial and Silicon Valley Bank CEO Greg Becker said: “SVB and Leerink share a focus on providing financing and strategic advice at critical stages in a company’s growth and development.
“Together, we will deliver a complete capital markets offering – including debt, convertible debt and equity financing – and advisory services – including mergers & acquisitions – for private and public healthcare and life science companies. Leerink is a best-in-class firm and we look forward to welcoming our Leerink colleagues to SVB.”
Leerink Partners focuses on making investments in healthcare and life science industries. Its parent company is engaged in equity and convertible capital markets, mergers and acquisitions, equity research, and sales and trading for healthcare and life science start-ups.
On the other hand, Silicon Valley Bank offers commercial and private banking, asset management, private wealth management, brokerage and investment services and funds management services. It caters to companies in the technology, life science and healthcare, venture capital and private equity among others.
As per the terms of the deal, SVB Financial will provide a retention pool for employees worth $60m, which will to be paid over five years.
The transaction will create a new entity named SVB Leerink, which will operate as a wholly-owned subsidiary of the California-based SVB Financial Group. It will be headed by the present chairman and CEO of Leerink – Jeff Leerink, in the role of CEO.
The acquisition is expected to fast track the growth and geographic footprint of Leerink’s offering, while giving SVB Financial a diverse and growing revenue stream.
Leerink said: “This merger represents an important step forward for our firm as we continue to strive to be an indispensable company-building partner to our expanding global client base.
“SVB and Leerink share a strong client-focused culture, uniquely aligned on building long-term client relationships.”
The transaction, which has been approved by Leerink’s shareholders, is expected to be wrapped up during the first quarter of 2019.