JEF - Jefferies Group, Inc. (NYSE:JEF)

Mon Nov 12, 2012 8:30 am EST

Nov 12 (Reuters) - Investment company Leucadia National Corp said it will buy Jefferies Group Inc in a deal that values the investment bank at $3.6 billion.

Leucadia, which has been called a mini Berkshire Hathaway for its holdings ranging from real estate to mining, already owns about 29 percent of Jefferies.

Under the agreement, Jefferies shareholders will receive 0.81 Leucadia share for each Jefferies share held, valuing Jefferies at $17.66 per share, a premium of 24 percent to its Friday closing price of $14.27.

The deal will provide Jefferies with "greater balance sheet resilience" and allow it to better handle volatile markets, the companies said in press release Monday morning.

The deal will also result in lower taxes on Jefferies profits by using income tax benefits Leucadia holds from past operating losses, they said.

Jefferies' credit rating was cut on Oct. 16 to Baa3, one notch above junk, or speculative grade, by Moody's Investors Service. Moody's cited the investment bank's aggressive growth strategy and increased challenges of operating an investment bank in the face of capital market risk.

Jefferies shares were at $17.00 in premarket trading Monday, up 19 percent from their Friday close.
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UPDATE 2-Leucadia to buy Jefferies, valuing it at $3.6 bln | Reuters


Jefferies Agrees to Sell to Leucadia for $2.76 Billion - Bloomberg
 
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