Stifel Financial Corp. has entered into an agreement to acquire Merchant Capital, a public finance investment banking firm headquartered in Montgomery, Ala.

Merchant Capital is well known in the affordable housing industry for its work in underwriting and structuring bonds and other financing. It has offices in Atlanta; Columbia, S.C.; and Seattle.

Terms of the deal, which is expected to close this month, were not disclosed.

“For 27 years, we have dedicated ourselves to the public finance and affordable housing sectors of the economy,” said Thomas Harris, chairman and CEO of Merchant Capital, in a statement. “We have consistently been ranked as one of the top underwriting firms in the Southeast region in public finance, and a leader nationally in affordable housing. We are excited to partner with Stifel to continue providing our clients with an extraordinary level of service, experience, and commitment to success.”

All of the senior leadership team has executed continuation agreements in support of the combination.

The move is expected to strengthen Stifel’s position in several key markets in the Southeast. Stifel (NYSE: SF) is headquartered in St. Louis.

“The addition of Merchant Capital marks our third public finance acquisition following Stone & Youngberg in 2011 and De La Rosa in April of this year. As we look to build our public and corporate finance expertise nationwide, the Merchant team will further enhance our capabilities in the Southeast. This is a high-quality team with a great reputation in the markets they serve,” said Ronald J. Kruszewski, chairman and CEO of Stifel,