Updated from 3:59 p.m. EST
Volpe Brown Whelan
, among the West Coast's last independent investment banks, the companies said Monday.
A spokesman declined to disclose the cash price paid by Prudential, the brokerage unit of
Prudential Insurance Company of America
, a mutual insurance concern.
The acquisition is intended to raise Prudential's profile in the technology sector, where Volpe Brown, a closely held San Francisco firm, has been an active underwriter.
Prudential noted that the deal also expanded its presence in northern California, a critical area for investment banks competing for technology business.
Thomas Volpe, who was chief executive at
Hambrecht & Quist
before starting his own firm in 1986, will manage the new unit with his longtime business partner Robert Whelan. The division will be called the
Prudential Volpe Technology Group
, which is buying
Hambrecht & Quist
for a reported $1.35 billion, Prudential seems to have decided that the easiest path into technology underwriting is buying a company that already has a thriving business in the area, said Carla D'Arista, who covers financial stocks for
Friedman Billings Ramsey
The deal "sounds like a mirror image on a second tier," D'Arista said.
While big financial firms like
Morgan Stanley Dean Witter
have made clear inroads into technology underwriting on their own, linking with an established name in research in the hot sector can't hurt, D'Arista said.
Financial service firms, with their need for encryption and communication services, as well as their push to provide online trading services, are among the top customers for technology companies, she noted. Friedman hasn't done underwriting for any of the companies mentioned, and she rates Chase a strong buy.
Talks between Prudential and Volpe Brown were reported in
The New York Times