SunTrust Acquires Lantana - Analyst Blog

SunTrust Robinson Humphrey, the corporate and investment banking arm of SunTrust Banks, Inc. STI recently completed the acquisition of Lantana Oil & Gas Partners. The financial details as well as terms and conditions of the deal were not disclosed.

The acquired company will be renamed Lantana Energy Advisors, a SunTrust Robinson Humphrey company and continue to be based in Houston.

Lantana offers advisory services for acquisition and divestiture (A&D) deals in the upstream sector. The sector primarily focuses on exploration and production (E&P) in the oil and gas industry.

With the discovery of shale gas, the upstream sector in the U.S has witnessed a consistent rise in A&D activities over the last few years. Consequently, the demand for advisory services in the oil industry has risen as well.

Apart from offering traditional investment banking services, SunTrust is constantly on the lookout for investment opportunities that serve as alternative profit-making avenues. Hence, the acquisition of a leading advisory firm like Lantana seems to be a strategic fit that will aid SunTrust's top-line growth in the coming quarters.

Moreover, as stated by John Gregg, the Chief Executive Officer of SunTrust Robinson Humphrey, Lantana will not only complement the investment banking segment but also help enhance SunTrust's wholesale banking segment. Looking ahead, given its healthy capital and liquidity position, we expect SunTrust to continue exploiting opportunities in booming sectors like energy to enhance its top line.

Currently, SunTrust carries a Zacks Rank #3 (Hold). Some better-ranked major regional banks include BankUnited, Inc. BKU, Fifth Third Bancorp FITB and KeyCorp. KEY. All these stocks have a Zacks Rank #2 (Buy).