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Capital Markets


A Leaner and More Focused Franchise

GMP’s Capital Markets segment operates under the brand, GMP Securities, providing a broad range of investment banking, including advisory and underwriting, research and sales and trading services to corporate and institutional clients. GMP Securities is recognized as a leading common equity underwriter and financial advisor to the small- and mid-cap segments of the Canadian capital markets and a leading industry participant in the mining and energy sectors.

Our Capital Markets business combines the 20-year history and transactional expertise of an industry-leading independent Canadian broker dealer, with a formidable fixed income platform and emerging energy franchise in the United States, and a commodities boutique in Asia to meet our clients’ short- and long-term strategic objectives. A highly disciplined client-centric approach ensures our clients’ interests always remain top priority. GMP Securities’ track record of success and its deep and enduring client relationships attest to the strength of this approach.


AN INTEGRATED TEAM APPROACH
As a fiercely independent and integrated franchise, GMP Securities is able to efficiently coordinate across investment banking, sales and trading and research to deliver seamless and unbiased advice and product-agnostic solutions to our clients. Offices across Canada, the United States, and Asia serve as gateways to the full capabilities and expertise of the franchise.

INVESTMENT BANKING
Our investment banking professionals aspire to be the leading trusted advisor and financier to our core clients across their entire business lifecycle. Over the past 20 years, we have taken great pride in helping entrepreneurs build and grow their businesses and, more importantly, navigate the complexities of global markets — no matter the economic environment.

GMP Securities’ investment banking professionals are highly conversant across the entire corporate finance spectrum and combine substantial product knowledge, deep industry expertise and extensive transactional experience to provide best-in-class advice and superior execution. Employing a disciplined approach to client solutions, experienced industry professionals are committed to working closely with clients to identify the best financing and strategic solutions to meet their needs. The complete and extensive resources of the firm are dedicated to helping our professionals deliver on that promise. Clients also benefit from compelling and proven after-market liquidity and trading support facilitated through leaner but highly effective and skilled sales and trading teams and focused research.

In Canada, we continue to be a dominant player in all aspects of the small- and mid-cap segments of the capital markets. In this market, highly experienced teams of investment banking professionals provide access to a broad range of products, services and expertise in all of our focus industries, including: Mining; Energy; Financial Services; Technology and Healthcare; Real Estate; and Industrials and Special Situations.

GMP Securities has also built out the scale and scope of our origination and distribution capabilities in the United States as well as broadening our advisory capabilities. The emerging Energy franchise in Houston is highly synergistic with the firm’s dedicated energy offices in Calgary, Hong Kong and Beijing. Our clients also benefit from the expertise of our Debt Work-Out and Restructuring business in our New York office. Additionally, a small and highly effective team in Asia continues to offer critical access to key Asian accounts on buy and sell mandates for our North American investment banking teams. In 2015, investment banking fees declined 23% compared with 2014 led by a 43% decrease in underwriting fees. Global energy and global mining investment banking fees declined 37% and 21%, respectively, compared with 2014 amid a broadly based slow-down in these sectors.

In our underwriting business, GMP Securities’ highly skilled and sector-focused investment bankers deliver superior transaction execution across a variety of equity and debt securities, including both public and private capital markets transactions. The team has extensive experience and a successful track record of raising capital for our corporate clients. GMP Securities is recognized as a leading common equity underwriter in the Canadian capital markets and a leading common equity underwriter to the global mining and energy sectors. GMP Securities ranked first among independent investment dealers and seventh overall in dollar value of completed common equity underwriting transactions in Canada.

GMP Securities is one of the largest independent fixed-income dealers in the United States, specializing in high-yield and convertible debt and is recognized as an emerging leader in high-yield origination. The firm has built a reputation for executing large and highly liquid transactions and structured, customized debt financings. We have a deep understanding of the debt markets and are focused on delivering origination and structuring expertise together with exceptional distribution and trading capabilities to a diverse investor base.

In 2015, GMP Securities participated in 155 equity and debt underwriting transactions completed in Canada with an aggregate value of $24.5 billion, leading or co-leading 30 of these transactions valued at $2.9 billion. While GMP Securities’ traditional strengths have been in the resources sector, the firm’s non-resources franchise continues to perform well. Non-resource investment banking revenue represented 40% of total investment banking revenue in 2015 compared with 32% in 2014.

Our M&A professionals are industry specialists focused on developing a deep understanding of our clients’ businesses. We believe this is why GMP Securities has a well-earned reputation as a trusted business advisor. Advisory fees increased 56% in 2015 as we benefited from robust client acquisition activity in the mining and energy sectors during the first half of the year.

During 2015, GMP Securities advised on 10 completed M&A transactions with an aggregate value of US$3.5 billion. M&A experts deliver powerful insight across the firm’s core industry sectors and extensive transactional expertise. GMP Securities’ formidable and growing advisory capabilities leave us well positioned to help clients recognize and execute on emerging M&A opportunities.

SALES AND TRADING
The proliferation of electronic and algorithmic trading, direct market access, dark pools and smart order routing has permanently altered sales and trading businesses across the industry. This phenomenon is known as ‘disintermediation’, where the traditional role of the institutional broker is being devalued by a wave of technological advancements in trading and regulatory changes. The result is a permanent contraction in total industry-wide commission revenue.

In response, we have substantially streamlined our sales and trading professionals and changed the way we deploy capital in our trading business. We have identified our core franchise names and, simply put, we strive to dominate the trading in each of those securities. We believe this institutional market and trade flow intelligence is central to our ability to be a meaningful industry player in executing bought deal financings. As such, the need to properly deploy capital in our secondary business has never been more essential. Accordingly, our sales and trading professionals work very closely with our origination professionals on all securities offerings. Through high-level and strategic internal collaboration, we are able to leverage GMP Securities’ comprehensive resources to provide our clients with the competitive advantage they seek. Because we buy and sell equity and fixed income securities as an agent, our clients can feel confident knowing that our recommendations are always based on unbiased advice.

GMP Securities is a client-focused sales and trading platform committed to delivering the firm’s resources before, during and after a successful transaction. Clients regularly turn to us for deep liquidity and a proven ability to execute transactions throughout the market cycle. GMP Securities has forged a leadership position in both equity and debt capital markets precisely because we deliver superior execution, timely market insights and exceptional client service. Our success in executing large and complex transactions is rooted in our ability to connect our clients to opportunities and investors worldwide by employing a formidable network of relationships.

Equity
Equity sales and trading has been a core area of expertise since GMP Securities’ inception over 20 years ago. Our reputation is founded on our superior execution of transactions and the ability to get the job done. GMP Securities is consistently recognized as a leader in the origination, distribution and trading of equity and equity-related securities. The firm’s equity sales and trading is focused on delivering compelling institutional market and trade flow intelligence synonymous with the GMP Securities franchise. Our clients also benefit from strong institutional and retail networks for new product distribution that are based on long-standing and extensive industry relationships.

Fixed Income
GMP Securities offers clients comprehensive market expertise and insight across a wide range of global debt instruments that includes: high-yield and distressed bonds, convertible debt, investment grade debt and international bonds. Our sales and trading professionals have cultivated deep and long-standing relationships with leading institutional fund managers, U.S. banks and wholesale market brokers. Our trading strategies are based on actionable insights and market-trading intelligence. These strategies are supported by an extensive and wide-reaching network of global counterparty relationships and strong, secondary market-trading acumen. We are also recognized as a leading market-maker in a wide range of debt securities.

Collaborating closely with top-calibre investment banking professionals and desk analysts, GMP Securities’ sales and trading professionals provide our clients with immediate access to a first-rate distribution network for debt issuance, quality independent fixed-income research and prospective market opinions.

RESEARCH
GMP Securities remains committed to fundamental research. Our team is well recognized for providing prescient opinions and differentiated investment ideas to enable clients to make informed decisions. Experienced research professionals in Canada and the United States provide differentiated equity and fixed-income research coverage on hundreds of companies spanning industry sectors. GMP Securities’ research teams work closely with our sales and trading professionals to translate their insights into actionable investment opportunities that offer the potential for superior, risk-adjusted returns.