Financial Stocks Narrowly Lower This Afternoon; SWS Group, Hilltop Holdings Hit New Highs on Buyout Proposal

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Financial stocks are slightly lower this afternoon, with the NYSE Financial Sector Index slipping less than 0.1% and the S&P Financial 100 Index falling 0.3%.

In company news, SWS Group ( SWS ) shares climbed to a two-year high on Friday after the Dallas-based financial services company confirmed receiving an unsolicited, $175 million buyout offer from Hilltop Holdings ( HTH ).

HTH currently owns nearly 10.2 million SWS shares, or about 24.4% of the company, and is offering $7 in an equal mix of cash and stock for each of 25.1 million shares it does not already own. SWS said it is now reviewing the proposal "to determine the course of action that it believes is in the best interests of the company and its stockholders."

Any deal would require SWS board members and shareholders agreeing to the offer as well as regulatory approvals.

HTH also said it may begin talks with Oak Hill Capital Management Partners to either buy out or restructure a $100 million term loan taken out by SWS and maturing in July 2016. As part of the loan agreement, Oak Hill received warrants to purchase up to 8.4 million SWS shares as part of the loan agreement.

SWS shares were up nearly 21% at $7.32 apiece, climbing as high as $7.40 - matching some of the stock's best levels since January 2012. HTS was ahead 8.6% at $25.46 a share in recent afternoon trade, holding within 15 cents of its new 52-week high set earlier in the Friday session.

In other sector news,

(+) SSS, (+1.8%) Acquires seven self-storage facilities totaling more than 575,000 square feet of rental space for $98.7 mln in five separate transactions. It also purchased five properties during Q4 for $44.7 mln and two more last week for $54 mln.

(-) BLK, (-0.5%) Goldman Sachs reduces its investment rating for the investment manager to Neutral, citing valuation after shares underperformed in 2013.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Commodities

Referenced Stocks: HTH , SWS

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