Private equity firm the Carlyle Group LP (Nasdaq: CG) teamed with several other financial buyers and agreed, late Dec. 30, to purchase investment banking firm Duff & Phelps Corp. (NYSE: DUF) for about $665.5 million.
The consortium includes Greenwich, Conn.-based Stone Point Capital LLC, Swiss bank Pictet & Cie and Luxembourg-based Edmond de Rothschild Group.
In a statement, Carlyle managing director Olivier Sarkozy, who heads the firm's global financial services group, said a joint-ownership of Duff & Phelps with overseas firms Pictet and Edmond de Rothschild are in line with the target's growth initiatives, which include expanding its international presence.
The transaction will pay $15.55 a share to Duff & Phelps stockholders, a premium of roughly 19.2 percent. The New York-based target, which closed at $13.05 a share on Dec. 28, is allowed a “go-shop” period, during which it will seek higher bids from other acquirers until Feb. 8, 2013.
If Duff & Phelps abandons the deal for a higher offer before March 8, 2013, then it is required to pay Washington, D.C.-based Carlyle and the other buyers a break-up fee totaling $6.65 million—less than one percent of the deal value.
With such a low fee, Duff & Phelps is expected to make a serious effort to determine if there is a rival bidder willing to make a higher offer.
As of Dec. 31, Duff & Phelps has a market capitalization hovering $660 million. The firm tapped Centerview Partners to run the sale process, along with David Fox, Daniel Wolf and Joshua Zacharia of Kirkland & Ellis to handle legal matters.
Barclays plc, Credit Suisse, RBC Capital Markets and Sandler O’Neill and Partners are advising the buy-side private equity firms.