Why Greenhill & Co. Stock Jumped 15% on Tuesday

Shares of Greenhill & Co. (NYSE: GHL) are surging on Tuesday, trading higher by about 15% as of 11 a.m. EDT after the investment bank announced a recapitalization plan that would effectively allow it to buy out most of its minority public shareholders.

Under the plan, the company expects to issue $300 million of debt plus $20 million of equity, which will be used to refinance existing debt and buy back millions of shares of stock. The buyback will start with a tender offer to repurchase up to 9 million of stock at $17 per share.

Greenhill & Co. had about $80 million of bank debt as of June 30, 2017, which will be paid off with the $320 million of combined debt and equity raised under its recapitalization plan.

Source: Fool.com