(Reuters) - Jefferies Financial will strengthen its presence in Canada through an expanded partnership with Japan's Sumitomo Mitsui (NYSE:SMFG) Banking Corp (SMBC), as it looks to tap into the dealmaking market in the country.
The companies said on Thursday they have worked together on cross-border mergers and acquisitions, healthcare and leveraged finance since 2021.
U.S. investment banks have been sharpening their focus on Canada, which offers a competitive advantage.
Easing wage inflation and potential interest rate cuts in Canada are expected to boost mergers and acquisitions (M&A) in 2024, analysts have said.
SMBC and Jefferies, which set up an investment banking unit in Canada a few months ago, have been strengthening their partnership.
Last year, the Japanese firm boosted its U.S. presence by combining its U.S. equity and M&A business with Jefferies. The deal also included SMBC's parent, Sumitomo Mitsui Financial Group , increasing its stake in the U.S. investment bank.
In January, the two companies extended their alliance in the Europe, the Middle East and Africa (EMEA) markets.