Investment bank Cowen Group and Ramius, an alternative investment funds manager, are merging, pending approval by Cowen shareholders.
The deal is expected to close in the fourth quarter, according to a joint news release.
The combined firm will take the Cowen Group name while Ramius will continue to operate under its own name and serve as the firms investment management unit, said a source close to the deal who asked not to be identified.
The newly combined firm will have $8.2 billion in assets under management, according to presentation materials available on Cowens investor relations website.
Ramius assets totaled $7.7 billion as of March 31, with $3 billion in hedge funds, $2.1 billion in hedge funds of funds, $1.6 billion in real estate, and $1 billion in cash management. Cowens Healthcare Royalty Partners will bring $500 million to the new firm.
Peter A. Cohen, Ramius founder and managing member, will be chairman and CEO of the combined firm, according to the news release. Greg Malcolm, Cowen Groups CEO and president, will retain those roles for the firms broker-dealer subsidiary. Morgan Stark, a Ramius managing member, will serve as CEO of Ramius internal asset management operations. Thomas Strauss, managing member, will remain CEO of the Ramius hedge funds-of-funds family.
As part of the deal, Ramius and its investors will receive Cowen shares that will give them a 71.24% stake in the new company, while Cowen shareholders will own 28.76%, according to the release. As part of the transaction, the new company will buy back the 50% stake in Ramius hedge fund-of-funds family from an unnamed third-party investor.
The firm will be headquartered in New York after the merger and no layoffs are planned among the combined 578 employees of both firms, said the anonymous source.