UK stockbroker Shore Capital has bought rival Stockdale Securities in a deal worth £9 million (US$11.6 million). It is the latest example of consolidation in a sector that is expected to shrink under European trading rules, reported the Financial Times.
The tie-up will create the fourth-largest corporate broking and advisory business in London. The combined entity will advise around 125 clients and provide research on about 300 stocks.
“It is appealing to have that kind of scale,” said Simon Fine, co-chief executive of Shore. The deal would give Shore specialist investment fund capability and improve its corporate advisory and broking, equity research, sales and trading services, the company added.
The EU’s Mifid II rules, now a year old, have triggered a shake-up in the way brokerages do business, forcing asset managers to set up expensive systems for reporting trades and to pay for research and trading separately.