New York – Bloomberg Businessweek reports today that Ticonderoga Securities LLC, the New York-based broker-dealer started in 2009, has reached a preliminary agreement to buy independent research firm Soleil Securities Corp. The takeover talks have not been announced publicly, but a definitive agreement may be signed in the next few days, according to Businessweek.
Ticonderoga Securities is a broker-dealer primarily providing execution services in US and global markets. The firm has a team of 6 research analysts covering Networking & IT Hardware, Brokerage and Asset Management, Homebuilding and Building Products, and the Oil & Gas Sector. This research team will be significantly reinforced by the integration of Soleil, which currently has a network of 17 research analysts covering 10 sectors, including Consumer, Financial Services and Utilities. Recently, Soleil has also added macro strategy and policy research to its suite of offerings.
Soleil was started in 2003 in the aftermath of the Wall Street research settlement, and is partly owned by Bain Capital’s venture-capital unit.
Investment research continues to be a challenging market for VC and PE firms, even more so than it was before the financial crisis. Recent regulatory efforts to crack down on usage of outside experts has created further problems for the industry, particularly those firms without the resources to build a robust compliance process.
Although the terms of any pending deal are not public knowledge, this may serve as a barometer of the health of the research industry. With research commissions down across the board over the last 2 years, we would expect to find that valuations of firms like Soleil have been reduced that time period. Other private equity and venture capital firms invested in the space will be looking at Bain Capital’s exit quite closely.