Piper Jaffray Companies, an investment bank and institutional securities firm headquartered in Minneapolis, is exiting the traditional asset management business by selling its Advisory Research Inc. (ARI) business, according to a news release.

The Chicago-based ARI unit, which Piper Jaffray acquired in 2010, provides a global clientele with in-depth investment research.

Earlier this year, Piper Jaffray signed a definitive agreement to sell ARI’s midstream energy business to Tortoise Capital Advisors, and a letter of intent to sell the remaining business—which was just completed—to a partner group led by Matthew Swaim, managing director and executive committee chairman at ARI.

Piper Jaffray said it expects to generate net cash proceeds from these two transactions of approximately $60 million to $70 million, exclusive of potential earn-out proceeds.

Chad Abraham, CEO of Piper Jaffray, said his company intended to reinvest the capital from both transactions in core strengths that would generate higher returns to Piper Jaffray shareholders.

The company said its decision to sell was based on changes in the asset management industry since acquiring ARI in 2010. It also wants to put a greater emphasis on scaling its own financial performance to grow shareholder returns, as well as enable ARI to scale to its potential.

“Without significant investment, the business lacks the potential to scale to a level that will represent a meaningful part of Piper Jaffray’s overall business mix,” said Deb Schoneman, president of Piper Jaffray. “We are confident that Matt and his partners will continue to provide excellent stewardship of these client assets by providing exceptional investment results and client service to their client base.”

ARI currently represents about 5% of Piper Jaffray’s adjusted net revenue.

Commenting on the sale, Tortoise CEO Kevin Birzer said that bringing together two of the longest tenured midstream energy teams would create an even stronger and deeper combined team.

The remaining ARI teams, based in Chicago, will continue to manage their existing products and client assets.

First « 1 2 » Next