UPDATE 3-Macquarie buying Canada's Tristone for C$116 mln

* To pay C$57 mln in cash, C$59 mln in exchangeable shares

* Expands Canadian financial and energy operations

* Most of Tristone's 170 staff to stay on (Adds comments from Tristone's Gosbee)

By Jeffrey Jones

CALGARY, Alberta, May 28 (Reuters) - Australia's Macquarie Group Ltd (MQG.AX) is buying Tristone Capital Global Inc, the Canadian energy investment bank, for C$116 million ($105 million) to expand in oil and gas advisory services, asset deals and equity research.

Under the deal, Macquarie, which has been amassing businesses in Canada, will pay privately held Tristone C$57 million in cash when the deal closes and C$59 million in exchangeable shares over five years, up to a total of four million shares.

Reports of the discussions had surfaced in March. Macquarie had bought Orion Financial Ltd, another Canadian investment house, in 2007 and rebranded it under the Macquarie banner.

The acquisition of Calgary-based Tristone "continues the expansion of our advisory and capital markets activities and other related industries including leading pipeline and utility companies who are an important part of our infrastructure business," Paul Donnelly, chief executive of Macquarie Capital Markets Canada, said in a statement.

Tristone, established in 2000 by Calgary investment banker George Gosbee, also has offices in London, Houston, Denver and Buenos Aires.