Credit Agricole SA will acquire a majority stake in Belgian asset and wealth manager Degroof Petercam, as the French lender looks to boost its wealth management operations.
The bank’s Indosuez Wealth Management has signed an agreement to buy a 60% stake, according to a statement Friday, confirming an earlier Bloomberg report. That will be followed by a tender offer for the remaining shares.
The deal, which is expected to complete next year, values Degroof Petercam at €148.03 ($162.09) per share before various potential adjustments, according to a separate statement Friday. That suggests a total valuation of about €1.5 billion.
Existing shareholder CLdN group, a shipping company, will retain a stake of around 20% in Degroof Petercam, according to the statement. The impact on Credit Agricole’s CET1 ratio will be around 30 basis points.
Created through the 2015 merger of Degroof and Petercam, the wealth manager has its roots dating back to 1871, when it was founded by Franz Philippson, whose family is still among its shareholders. Owned by a group of several Belgian families and investment firm Cobepa, it had about €70 billion in total client assets at the end of 2022, according to its website.
Second Market
Snapping up the private lender will help Credit Agricole bolster its wealth division. It “will make Belgium our second domestic market,” Indosuez Chief Executive Officer Jacques Prost said in the statement.
The deal marks another high-profile transaction in the world of private banking, which offers lenders lucrative, recurring revenue streams while consuming less capital than other businesses such as investment banking. Royal Bank of Canada, for instance, bought Brewin Dolphin for $2.1 billion last year and Rathbones Group Plc agreed to buy Investec Plc’s UK wealth unit in April. UK bank Close Brothers is currently exploring the disposal of its wealth unit, Bloomberg News has reported.
Credit Agricole reported a surge in profit for the second-quarter on Friday. Net income for the period ending in June rose 25% to €2.04 billion.
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ABN Amro Bank NV was earlier keen to purchase Degroof Petercam, but its interest cooled recently, the people said.
--With assistance from Cagan Koc and Fareed Sahloul.
(Updates with details of the deal throughout.)
Author: Jan-Henrik Förster and Alexandre Rajbhandari