Corporate Financier’s Notes by Aivars Jurcans
Done! And Done
Wells Fargo has agreed to sell its asset management arm to GTCR and Reverence Capital, US private equity firms, for USD 2.1 billion. Wells Fargo Asset Management has USD 603 billion of client funds; the deal price is equivalent to 0.3% of assets under management.
Aviva, a UK insurer, has agreed to sell its French business to Aema Groupe, a French insurer created through a merger of Macif and Aeseo (mutual insurance companies), for EUR 3.2 billion. After the deal Aema will become “one of the top five players in the French market.”
Bank of Queensland, an Australian lender, has agreed to buy ME Bank, a digital lender owned by 26 industry pension funds, for USD 1.05 billion.
Alpha Bank, a Greece lender, has agreed to offload a EUR 10.8 billion book of toxic loans to Davidson Kempner, a US hedge fund. The deal will reduce Alpha Bank’s NPL ratio from 29% to 13%. Davidson Kempner will also acquire an 80% stake in Cepal Holdings, Alpha Bank’s loan servicing subsidiary.
M&T Bank, a Buffalo-based lender, has agreed to buy People’s United Financial, a regional lender, in an all-stock deal for USD 7.6 billion. Combined, the banks will have more than USD 200 billion in assets.
Source: WSJ, FT
Deals On The Table
UBS, a Swiss lender, is said to be considering disposing of its wealth management domestic business in Spain which has assets of about USD 11 billion.
Citigroup is said to be considering divesting some of its international consumer units in the Asia-Pacific region.
NatWest, a UK lender, is said to have signed a memorandum of understanding with Allied Irish Bank, Ireland’s lender, about a potential sale of a EUR 4 billion commercial loan portfolio.
Thanks, But No Deal
Athene Holding has said that it is not in discussions with American International Group, an insurer, “regarding a transaction involving an AIG business unit”.
NatWest has confirmed that it would begin a retreat from the Republic of Ireland, where it operates as Ulster Bank, to “free up capital and focus on its core UK market”.
Klarna, a Swedish payments company, is said to be raising USD 800 million and up to USD 1 billion valuing the fintech startup at around USD 31 billion, roughly tripling its valuation after the most recent round in September 2020.
Citigroup says European NPLs could surge from EUR 600 billion at present to EUR 1 trillion.
Americans took out a record of USD 1.2 trillion worth of mortgages in Q4 2020, locking in historically low interest rates.
A Thought Worth Noting
“Growth stocks, which are now largely concentrated in the tech sector, tend to be more sensitive to interest rate movement than, for example, value stocks. Try to increase the discount rate and the valuation adjustment could be quite brutal, especially for narrative-driven stocks with negative cash flows.”
Artur Baluszynski, managing director, Henderson Rowe
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