KeyCorp. has acquired McDonald & Co., an investment banking and securities brokerage firm. The stock transaction is valued at $653 million.
The combined operations will focus on providing investment banking, capital markets and asset management expertise to corporate and private clients.
A new entity will be created, Key Capital Partners, under which two units will operate. McDonald-Key Investments will offer retail and institutional brokerage, equity and fixed income trading and underwriting, investment banking, capital markets and other services. The other business group, as yet unnamed, will handle asset management, mutual funds, institutional asset services, wealth management and insurance.
McDonald-Key Investments will work in McDonald's Cleveland location.
KeyCorp. also has established a $68 million employee retention program for certain McDonald staff members to be paid in cash and options in the next three years.
KeyCorp., a financial services and bank holding company, has $64 billion in total assets under management worldwide, of which about $30 billion is U.S. institutional tax-exempt. McDonald has more than $5 billion in total assets under management.
Los Angeles City Employees' Retirement System will invest $5 million in the $3.5 billion Apollo Investment Fund IV. Apollo will focus on investments or securities that provide equity-type returns, said Dan Gallagher, CIO. It will also pursue leveraged acquisitions, growth financings and restructuring investments in various industries.