Jefferies Group to Spin Off ITG

In a deal expected to be announced today, Los Angeles-based holding company Jefferies Group will separate fast-growing investment bank Jefferies & Co. and computer-based stock trading company Investment Technology Group through a spinoff. Under the plan, ITG and Jefferies & Co. each will be separate, wholly owned companies. Jefferies & Co., a $1-billion niche brokerage firm, will be a separate company trading on the New York Stock Exchange. ITG, a $620-million company that specializes in computer-based stock trading, would be a separate company traded on Nasdaq. “This transaction will give Jefferies more capital than it had before and give it laser-like focus on investment banking,” said Frank E. Baxter, the chairman of Jefferies. With offices in New York and Los Angeles, Jefferies added ITG in 1987, and the company has grown rapidly in recent years. Jefferies Group expects to complete the deal by the end of the year.