Cerberus Capital Management has entered into a definitive agreement to sell Chrysler Financial, a provider of automotive financial products and services, to TD Bank Group (TSX, NYSE: TD) for $6.3 billion. The transaction includes $5.9 billion of net assets and about $400 million in goodwill. Cerberus has backed Chrysler Financial since it bought the automobile manufacturer Chrysler in 2007. While Cerberus lost its investment in Chrysler when it went bankrupt, the PE firm retained ownership of Chrysler Financial, which was not included in the bankruptcy.
Since the beginning of 2009, 130 PE investors have invested in 192 companies in the Financial Services industry, according to the PitchBook Platform. Deal activity is up slightly this year with 101 completed deals, compared to 95 in 2009. What has changed though is deal size, as shown by a rise in the median deal size from $59.1 million in 2009 to $106.7 million in 2010. The Commercial Banks sector has accounted for more of those completed deals than any other sector, accounting for 39.6% of the industry's deal flow this year. The most active PE investors during the two-year time period include Stone Point Capital (13), Parthenon Capital Partners (10), Patriot Financial Partners (10), GS Capital Partners (9) and Lightyear Capital (9).