04:46 AM EDT, 09/19/2025 (MT Newswires) -- Jefferies Financial ( JEF ) and Sumitomo Mitsui Financial ( SMFG ) said Friday they will combine their Japanese equities and equity capital market businesses, with Sumitomo agreeing to increase its stake in Jefferies to up to 20% in the open market.

As part of the deal, Sumitomo will provide Jefferies with about $2.5 billion in new credit facilities to support the company and their collaboration, they said.

The new initiatives also include expanding joint coverage of larger sponsors and implementing in Europe, Middle East, and Africa joint origination, underwriting, and execution of syndicated leveraged loans, the companies said.

The companies said they have reached a memorandum of understanding to create a joint venture in Japan to facilitate the partnership. They expect the JV to start serving clients in January 2027.

Sumitomo will continue to own less than 5% of voting interests in Jefferies.