Holding company Leucadia National (NYSE:JEF) plans to acquire investment banking firm Jefferies Group (NYSE:JEF), merging with the New York-based company to form a new $9 billion business. Jefferies shareholders are to receive 0.81 shares of Leucadia stock for each share of Jefferies stock they own. This deal excludes Jefferies stock owned by Leucadia itself, which held a 28.6% stake in the company before the deal announced Monday.

Leucadia touted the merger as an efficient combination of two successful businesses. Jefferies will have "greater balance sheet flexibility" as a subsidiary, and will realize new tax advantages as a result of Leucadia's net operating losses, according to the release.

The deal will make Jefferies Leucadia's largest business unit, as well as an owner of more than 35% of Leucadia's outstanding stock. The Leucadia board also approved the repurchase of up to 25 million shares of Leucadia stock, as well as confirmed its intentions to pay an annualized $0.25 dividend per share on a quarterly basis.

The merger is expected to close during the first quarter of 2013. It has already been approved by the boards of directors of both companies.

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