Piper Sandler Companies · NYSE:PIPR
Piper Sandler Companies — Piper Jaffray Companies — Merger or Acquisition (December 2009)
14 slides from Piper Sandler Companies's merger presentation, Dec 21, 2009
Slide 1: Piper Jaffray Companies December 21, 2009
PIPER JAFFRAY COMPANIES DECEMBER 21, 2009
Slide 2: Caution Regarding Forward-Looking Statements
2 CAUTION REGARDING FORWARD-LOOKING STATEMENTS Statements contained in this presentation may contain forward-looking statements. Statements that are not historical or current facts, including statements about beliefs and expectations, are forward- looking statements and are subject to significant ri
Slide 3: Transaction Overview
3 TRANSACTION OVERVIEW Chicago-based asset management firm $5.5 billion in AUM mainly in equity strategies $218 million in consideration, payable at closing $178 million in cash and $40 million in restricted stock Expected to close in the first quarter of 2010 Subject to customary regulatory approva
Slide 4: Strategic Rationale
4 STRATEGIC RATIONALE Diversifies revenues to mitigate volatility in current capital markets-centric business model Builds asset management to sufficient scale and adds talent to support future growth Attractive financial attributes for Piper Jaffray shareholders Complementary to FAMCO In the long t
Slide 5: Significant Expansion of Asset Management
SIGNIFICANT EXPANSION OF ASSET MANAGEMENT 17% 28% Net Revenue Mix1 Pre-tax Income2 PJC AS REPORTED ASSUMING ADVISORY RESEARCH 24% Investment Banking 17% Public Finance 28% Fixed Income Brokerage 28% Equity Brokerag e 3% Asset Management 15% Public Finance 22% Investment Banking 25% Fixed Income Brok
Slide 6: Transaction Drives Improved Key Metrics
TRANSACTION DRIVES IMPROVED KEY METRICS 17% 24% 28% PJC AS REPORTED ASSUMING ADVISORY RESEARCH Pre-tax Margin1 Annualized Return on Average Adjusted Shareholders' Equity1,3 17% 24% Nine Months Ending Sept. 30, 2009 Nine Months Ending Sept. 30, 2009 GAAP Basis Cash Basis2 GAAP Basis Cash Basis2 1See
Slide 7: Shareholder Rationale
7 SHAREHOLDER RATIONALE Advisory Research Operating Run Rate Summary $218 million, payable at closing $178 million in cash and $40 million in restricted stock that will vest ratably over four years Additional $7 million in restricted stock for employee retention; vests ratably over five years Fairly
Slide 8: Overview of Advisory Research, Inc.
8 OVERVIEW OF ADVISORY RESEARCH, INC. $5.5 billion AUM asset management firm Fundamental, "bottom-up", value manager Top performing domestic, international and global product offerings Equity products span the capitalization spectrum AUM Trend (in billions) Firm Overview AUM Type 80% of AUM managed
Slide 9: Disciplined Investment Process
9 DISCIPLINED INVESTMENT PROCESS Fundamental, bottom-up investment philosophy in place since 1974 Focus on quality companies with significant net asset value Rely on internally generated research Team-based decision making Favorable up/down market capture Small Cap Value Since Inception (1/1/1987) S
Slide 10: Competitive Performance - Peer Group Comparison
10 COMPETITIVE PERFORMANCE-PEER GROUP COMPARISON Small Cap Value Small Mid Cap Value International Value All periods greater than one year are annualized. Peer group is the Zephyr Small Value Universe (Quarterly). Ranking is based on a 1-100 scale, 1 being the highest, 100 being the lowest, relative
Slide 11: Broad Investment Strategies to Meet Client Needs
11 BROAD INVESTMENT STRATEGIES TO MEET CLIENT NEEDS Advisory Research FAMCO Investment Strategies Micro Cap Value Small Cap Value Small/Mid Cap Value International Value Master Limited Partnerships Balanced Flex Equity ^ ^ ^ ^ ^ ^ ^ ^ ^ ^ Fixed Income ^ All Cap Value Global Value Energy ^ Quantitati
Slide 12: Growth Opportunities
GROWTH OPPORTUNITIES 12 Increased marketing resources Leverage deep distribution and complementary products Benefit from the Piper Jaffray global infrastructure Margin expansion in asset management from additional scale can support additional investments in the business
Slide 13: Unaudited Pro Forma Combined Results of Operations
Piper Jaffray Companies Unaudited Pro Forma Combined Results of Operations Pro Forma PJC PJC Pro Forma PJC Adjustments As Adjusted (Amounts in thousands, except per share data) As Reported Adjustments As Adjusted Cash Basis (5) Cash Basis (5) Revenues: Investment banking 134,615 $ — $134,615 $ — $13
Slide 14: Unaudited Pro Forma Combined Selected Components of Financial Condition
Piper Jaffray Companies UnauditedPro Forma CombinedSelectedComponents Unaudited Pro Combined Selected Components of Financial Condition PJC Pro Forma PJC (Amounts in thousands) As Reported Adjustments As Adjusted Assets Total assets other than Goodwill and Intangible assets (1) 1,306,793 $ (49,525)
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