Sumitomo Mitsui Financial Group Inc. SMFG said Thursday it will increase its ownership stake in investment bank Jefferies Financial Group Inc. JEF to 15% from 4.5% as part of a planned expansion of the corporate and investment banking relationship that the two firms inked in 2021. Sumitomo’s $2.25 billion investment in Jefferies from 2021 is now valued at about $3.4 billion. SMBC and Jefferies will seek shareholder approval of Jefferies shareholders for a new class of non-voting common shares, to boost its ownership position in Jefferies through direct and indirect open-market purchases of Jefferies’ common stock, which will be exchanged for non-voting preferred shares. These non-voting preferred shares bill be mandatorily convertible into non-voting common shares, the companies said. Shares of Jefferies are up 2.4% in premarket trades. U.S.-listed shares of Sumitomo are up 3% in 2023, compared to a 5.6% increase by the S&P 500 SPX.
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