Corporate Financier’s Notes by Aivars Jurcans
Done! And Done
Citizens Financial Group, a US regional bank, has agreed to buy Investors Bancorp, another regional bank, in a USD 3.5 billion cash and stock transaction. The deal is expected to give Citizens roughly USD 27 billion of assets and a bigger presence in New York City and Philadelphia.
Klarna, a Swedish payments firm, has acquired APPRL, a Stockholm-based influencer marketing software firm. The financial details of the deal were not disclosed.
Starling, a UK digital bank, has agreed to buy Fleet Mortgages, a Hampshire-based buy-to-let mortgage group, for GBP 50 million in cash and shares. Fleet manages GBP 1.75 billion of mortgages and expects to originate another GBP 800 million in 2021.
Bank of Ireland has agreed to buy most of Davy Stockbrokers for an enterprise value of EUR 440 million. Davy manages over EUR 16 billion of client assets and serves as a corporate broker for some of the largest firms listed on the Irish stock exchange.
Visa has agreed to acquire Currencycloud, a UK cross-border payments provider, at a valuation of GBP 700 million. Since its launch in 2021, Currencycloud has moved more than USD 75 billion in payments to over 180 countries.
AssetCo, a London-listed asset management acquisition group, has agreed to buy a 63% stake in Rize ETF, a thematic exchange traded fund provider, for GBP 16.5 million. The purchase price values Rize at GBP 26.2 million, equivalent to 8% of its assets.
Deals On The Table
Goldman Sachs Asset Management and DWS, a German asset manager majority-owned by Deutsche Bank, are said to be preparing bids for NN Investment Partners, an investment management arm of NN Group (a Dutch insurer). The deal is thought to be in the region of EUR 1.4 billion.
Ontario Teachers’ Pension Plan is said to be exploring a sale of SeaCube Container Leasing. The Ontario Pension purchased SeaCube in 2013 for USD 469.5 million.
The UK government is said to be planning to accelerate the sell-off of its GBP 12 billion stake in NatWest over the next year. The Treasury spent GBP 46 billion rescuing NatWest, formerly known as Royal Bank of Scotland, after it was caught up in the US subprime mortgage crisis.
Thanks, But No Deal
Aon and Willis Towers Watson, both insurance brokers, have abandoned a USD 30 billion tie-up that was expected to create the world’s biggest insurance broker after the US government sued to block the merger.
Metrics To Watch
Deutsche Bank is planning to bring down its cost-to-income ratio to 70% from its current level of 80%. Analysts forecast the ratio will hit 76% in 2020. The bank will target generating a return on tangible shareholder equity of more than 8% next year (compared with 5.5% achieved in Q2 2021).
Solarisbank, a Berlin-based digital banking platform, has raised EUR 190 million in a funding round that valued it at EUR 1.4 billion.
Judo Bank, an Australian challenger lender to small and medium-sized businesses, is said to be considering an initial public offering that would seek to raise USD 258 million.
Nium, a Singapore payments startup serving business, has raised USD 200 million in a funding round that valued it above USD 1 billion.
Paymate India, a business-to-business payment solution provider backed by Visa, is said to be preparing for an IPO that could raise about USD 400 million.
Kakao Bank, a South Korean digital lender, is said to be planning to raise USD 2.2 billion in its initial public offering.
According to data group HFR, hedge funds made a return of 11.8% on average in 2020, their best calendar year since 2009.
A Thought Worth Noting
“While the growth of ETFs will not be stopped by the rising popularity of direct indexing, wealth and asset managers will face disruption in how advisers expect products to be constructed and distributed.”
Neal Sheehan, analyst, Celent
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Aivars Jurcans has more than 20 years of corporate finance and investment banking experience. His services are currently available through MURINUS ADVISERS.
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