J.P. Morgan Cazenove will be wholly-owned by US investment bank J.P. Morgan.

J.P. Morgan has bought the remaining 49.99% of shares in UK stock brokerage firm, Cazenove, for a £1 billion figure, valuing the joint venture of J.P. Morgan Cazenove at £2bn.

J.P. Morgan Cazenove was formed in 2005 as part of a joint venture agreement when J.P. Morgan bought 50.01% in Cazenove for £159 million. Today’s announcement (19 November) means that J.P. Morgan Cazenove will become a wholly-owned part of J.P. Morgan.

In a joint statement released today the firms said the agreement would provide “certainty for all stakeholders” and the business will continue to operate under the J.P. Morgan Cazenove brand, providing a continued level of excellence for customers.

Cazenove shareholders will reportedly receive £5.35 per share, consisting of £5.10 upon closing for the sale of their shares and a dividend of 25p per share in December 2009. However, Cazenove shareholders will still have to give their approval, which is expected in early 2010.

US Investment bank J.P. Morgan already owns 50.01% in J.P. Morgan Cazenove and for the last five years its Corporate Finance business has been the number one Corporate Broker in the UK.  However, Cazenove’s Cash Equities business has remained separate, but under the takeover agreement J.P. Morgan will operate the business under the J.P. Morgan Cazenove banner.

David Mayhew, Chairman of J.P. Morgan Cazenove, said: “Our joint venture with J.P. Morgan has been a great success; benefiting our clients, our shareholders and our people.

“This agreement we have reached is a natural extension of our relationship. It builds on what we have achieved in the past five years and provides a platform for the next stage of development.”

Jes Staley, Chief Executive of J.P. Morgan’s investment bank, commented: “Five years ago, J.P. Morgan and Cazenove agreed to combine their talented people and prestigious brands in an effort to serve clients better. 

“We look forward to continuing that successful partnership in a new era and to growing the businesses. We believe the wholly-owned structure will enable us to offer clients a seamless service in the UK and abroad.”

The companies have confirmed that the existing senior executives will continue in their key roles in the newly combined business.