Daniels finds right fit in RBC

Denver investment bank's ties to cable spur consolidation

David Milstead, Rocky Mountain News

Published November 22, 2006 at midnight

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Denver-based Daniels & Associates, a national leader in investment banking for the cable industry, is selling itself to RBC Capital Markets.

Daniels & Associates will be renamed RBC Daniels and will retain its current offices in Denver and New York. RBC Capital Markets is a sister company to Minneapolis-based RBC Dain Rauscher. The two, which employ 177 in Colorado, are owned by the Royal Bank of Canada.

Chairman and CEO Brian Deevy will remain, as will current Daniels President and Chief Operating Officer Brad Busse. Terms were not disclosed.

"They have built up the premier merger-and-acquisitions franchise in the cable, broadcasting and telecom space," said Peter de Vos, the head of U.S. investment banking for RBC Capital Markets. "This is an area we've chosen to focus on, but we don't have the critical mass. By merging Daniels & Associates with RBC Capital Markets, we can get the critical mass we need."

Daniels & Associates' Busse said his company could offer clients private placements and merger advice, but couldn't provide things that a full-line investment bank offers, like bridge loans and debt instruments.

CEO Deevy said, "We didn't run an auction, we didn't put ourselves up for sale. We were looking for a fit and a culture where we thought our group could fit best."

Founded in 1958 by cable-industry pioneer Bill Daniels, Daniels & Associates has completed more than $100 billion in total transactions. In the first three quarters of 2006, the 45-employee company has completed 55 transactions with a total value of nearly $6.4 billion.

With the recent agreement by Denver-based energy specialists Petrie Parkman to sell to Merrill Lynch, both of Colorado's niche investment banks have been bought in a matter of weeks.

"There's a lot of consolidation in the investment-banking business, and a rash of acquisitions of middle-market firms," said Dave Maney, managing partner of local investment bank Headwaters MB.

The two firms grab bigger clients than most firms their size, Maney said. Both Deevy and Tom Petrie "are extremely competent guys, and that's why they snag the bigger fish."

Maney, who founded Worldbridge Broadband Services before Headwaters, used Daniels & Associates to sell the company. "Brian Deevy is one of the best investment bankers in the country. When they sold my company, they did a fantastic job. If I'm RBC Capital markets, I'm happy."

David Milstead is finance editor of the Rocky Mountain News. He can be reached at milstead@RockyMountainNews.com or 303-954-2648.

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