UPDATE 1-BMO expands U.S. capital markets business with acquisition

(Adds comments from BMO executives)
By John Tilak and Lauren Hirsch
TORONTO/NEW YORK, June 2 (Reuters) - Bank of Montreal
BMO.TO said on Thursday that it would acquire Greene Holcomb
Fisher, a U.S. mergers and acquisitions advisory firm, in a push
to strengthen its investment banking business in the United
States, particularly in the Midwest.
The move will help Toronto-based BMO, Canada's fourth
biggest lender, double its U.S. M&A business, based on the
number of deals. It takes its U.S. M&A team, which is led by
Lyle Wilpon, to 70 members, from 40.
Based in Minneapolis, Greene Holcomb Fisher offers
investment banking services targeted at the middle market, an
area that converges with BMO's U.S. strategy. It also has
offices in Seattle and Atlanta.
In the United States, BMO eyes companies with market
capitalizations of $200 million to $5 billion and focuses on
seven sectors, including energy, retail, industrials, healthcare
and technology.
"It accelerates our M&A business in the U.S.," said Perry
Hoffmeister, head of global investment and corporate banking at
BMO Capital Markets, in an interview. "It really gets us deeper
in our core sectors."
With the deal, BMO expects to sell investment banking
services to more lending clients in its commercial banking
business in the Midwest, where it has a strong retail banking
presence.
BMO, which did not disclose the terms of the deal, said the
two firms advised on M&A deals valued at $77 billion in 2015.
BMO did not go hunting for a target, Hoffmeister said. "This
acquisition happened to come along," he said, adding that
initial discussions with GHF began about a year ago.
The combined operations will enable BMO to better serve and
attract private equity clients, said Andre Hidi, global head of
M&A at BMO.
"(PE firms) like to get calls from investment banks
marketing companies that are a particularly good fit between a
firm that the investment bank is selling and one of their
portfolio companies," he said.
BMO's capital markets division expanded aggressively in the
United States since the financial crisis and has started to see
those efforts pay off.
While the U.S. investment banking industry is more
competitive than the Canadian market, several European banks
have been pulling back and smaller firms have been struggling.
Other Canadian banks that are active in the U.S. investment
banking market include RBC RY.TO and TD Bank TD.TO .

The deal is expected to close in BMO's fiscal fourth
quarter, when GHF will be rebranded as BMO Capital Markets.