In keeping with its strategy of streamlining operations and focusing on core businesses, JPMorgan Chase & Co. (JPM - Free Report) has announced the divestiture of yet another unit. The company will be vending off its Corporate Dealing Services business to the U.K.-based The Equiniti Group.
The Corporate Dealing Services business offers all types of share-based remuneration schemes. Further, as part of the deal, JPMorgan will partner Equiniti and continue to serve its corporate broking customers.
Notably, the financial terms of the transaction were not revealed. Nevertheless, the deal is expected to be closed by Aug 2014 end.
Upon completion, the business will be integrated into Equiniti’s Investment Services division. This unit presently holds custody of approximately £17 billion as client assets. Further, all the present employees of Corporate Dealing Services business will be absorbed into Equiniti.
Equiniti, formed when Advent International Corp. acquired Lloyds Banking Group Plc’s (LYG - Free Report) Lloyds TSB Registrars shareholder-services business in 2007, is a financial and business service provider., It is the largest provider of shareholder services to FTSE 100 companies in U.K.
With overall adverse macroeconomic scenario and continued fundamental pressure, the divestiture is a valid step for JPMorgan. Since 2014 beginning, the company has sold off a couple of non-strategic businesses.
In March, JPMorgan entered into a definitive agreement with Mercuria Energy Group Limited for the sale of its physical commodity trading business for $3.5 billion. Further in April, the company sold its 401(k) record-keeping business and Retirement Plan Services business to Great-West Financial.
Currently, JPMorgan carries a Zacks Rank #4 (Sell). Some better-ranked banks include KeyCorp. (KEY - Free Report) and BB&T Corporation (BBT - Free Report) . While KeyCorp holds a Zacks Rank #2 (Buy), BB&T has a Zacks Rank #3 (Hold).