Houlihan Lokey Agrees to Buy Japan’s GCA in $595 Million Deal

(Bloomberg) -- Houlihan Lokey Inc. agreed to buy Japanese rival GCA Corp. for about 65 billion yen ($595 million), amid a growing wave of consolidation between boutique banks eager to compete with larger Wall Street rivals.

Houlihan Lokey proposed to purchase Tokyo-based GCA for 1,380 yen per share, according to a GCA's exchange statement on Tuesday, confirming an earlier Bloomberg News report. The offer price represents a premium of about 31% above GCA's last traded price of 1,051 yen apiece on Monday.

The deal -- Houlihan Lokey's largest -- beefs up the Los Angeles-based bank, which tends to focus on advising small and mid-cap companies in technology investment banking, traditionally one of the busiest sectors for deals. Boutique banks have also been combining to take on lending giants like Goldman Sachs Group Inc. and JPMorgan Chase & Co.

GCA's board has approved the deal and Houlihan Lokey's tender offer will run from Aug. 4 to Sept. 27, according to the statement.

GCA is a global investment bank with more than 500 employees in 24 offices across North America, Asia and Europe, its website shows. It is based in Tokyo, where the stock is traded. Its shares have climbed 43% this year, giving GCA a market value of about $431 million.

Shares of Houlihan Lokey, which went public in 2015, closed 1% higher on Monday at $89.96 in New York, and have gained 34% this year. It has a market value of about $6.2 billion.

©2021 Bloomberg L.P.