Chinese conglomerate CEFC China Energy has announced its plan to buy a 20 percent stake in the American financial services Cowen Group for $100 million. Both companies have described the deal as part of the "long-term strategic investment."

According to the agreement, CEFC will buy Cowen's Class A shares at $18 per share, or a 29.5 percent premium to the closing share price on Tuesday.  Additionally, the Chinese energy conglomerate will offer $175 million to the New York-based brokerage firm, which the latter will mostly use to clear off the existing debts and financial re-structuring purposes.

Like Us on Facebook

CEO Peter Cohen hopes that the stake sale will help Cowen to further consolidate its business in core areas like investment banking, equities, research, and investment management. The brokerage firm also plans to enhance its presence in the Chinese market after the sale.

"We have been looking for strategic partners who could help us scale our business outside the US, particularly in China," Jeffrey Solomon, Cowen's president told the Financial Times.

Both companies are bonded by their common interest in financial services, but CEFC continues to earn a majority of its revenue from the oil and gas business. In 2014, the Chinese energy firm earned 60 percent of its revenue from oil and gas business and only 25 percent from financial service business.

This latest deal marks the second investment by a Chinese firm in an American company this week after Tencent snapped up a five percent stake in the California-based electric car firm Tesla a few days ago. Apparently, the talks of an impending trade war between China and U.S. as well as Chinese regulator's crackdown on capital flight seem to have no impact on these investment deals.      

TagsCEFC, CEFC China Energy Co., Cowen Group, china, China and U.S.