TORONTO (Reuters) - Canadian lender Toronto-Dominion Bank’s (TD.TO) capital markets division said on Tuesday it plans to acquire Albert Fried & Co, a New York-based broker-dealer, to expand its presence in the U.S. prime brokerage sector. TD Securities has been boosting its reach in the United States in recent years by adding people and increasing coverage of sectors.
The lender’s U.S. capital markets strategy has been to focus on large multinational clients, as well as sectors such as technology, media, telecommunications, energy and utilities.
TD, which did not disclose financial terms of the deal, expects to target hedge funds with its new services.
“With the prime brokerage acquisition, we have the opportunity to expand and service institutional clients more appropriately,” Glenn Gibson, the vice chair and U.S. head of TD Securities, said in an interview.
“There is this broad appeal for clients to diversify their broker relationships, specifically related to the prime brokerage business,” he added.
A 97-year-old firm that was founded after World War I, Albert Fried offers services in prime brokerage, trading and commission management.
David Santina, managing director of equities at TD Securities U.S., will lead the U.S. prime brokerage unit.
“Developing an integrated prime brokerage business really fills a niche for us in our U.S. product set,” Santina said.
Major Canadian banks have been beefing up their U.S. investment banking divisions at a time when global firms, especially European lenders, have been pulling back.
“As some of those global players pull back, there will be opportunities for us... to be able to step in and fill some of those gaps,” Gibson said.
In June, Bank of Montreal (BMO.TO) said it would buy Minneapolis-based mergers and acquisitions advisory firm Greene Holcomb Fisher, to branch out in the U.S. Midwest.
Royal Bank of Canada (RY.TO) has been expanding organically and has a strong U.S. investment banking business.
TD Bank was looking to double its U.S. capital markets business in three to four years, Gibson told Reuters last year.
Reporting by John Tilak; Editing by Will Dunham and Alan Crosby