Brokerage Cowen Group’s shares surged 19% on Wednesday after Chinese conglomerate CEFC China said it agreed to acquire a stake of about 20% in the U.S. company for $100 million.
The deal, the latest in a series of investments by Chinese firms in U.S. companies, will also give the CEFC the right to appoint three directors to the New York-based company’s board.
CEFC’s announcement comes a day after U.S. electric car maker Tesla Inc said China’s Tencent Holdings Ltd had acquired a 5 percent stake in the company for $1.78 billion.
Privately held CEFC China will also provide Cowen with $175 million in debt financing, the companies said.
“This partnership will accelerate growth in Cowen’s core areas of expertise: investment banking, equities, research and investment management,” Cowen Chief Executive Peter Cohen said.
CEFC will pay $18 for each Cowen Class A share, representing a 29.5% premium to the stock’s Tuesday close.
The deal, which is expected to close by third quarter of 2017, will be subject to regulatory and government approvals, the companies said.