Credit Suisse Group Friday said it is in exclusive talks to acquire Fortis Bank Nederland’s unit Prime Fund Solutions, a deal which would further increase the clout of its hedge fund services business, analysts said.
The parties didn’t comment on the size of the deal, nor on the unit’s financial details. The divestment would help Fortis Bank Nederland to concentrate on core businesses such as retail and private banking in the Netherlands and on international merchant banking, a spokesman for Fortis said.
Fortis Bank’s Prime Fund Solutions, a provider of fund services to the alternative asset management industry since 1969, has around 600 employees worldwide.
It is present in Ireland, Luxembourg, Isle of Man, Amsterdam, Cayman Islands, Curacao, Hong Kong and Singapore and has representative offices in Geneva, London, New York, Boston and Tokyo.
The spokesman didn’t indicate whether there have been expressions of interest from other parties. Analysts said the deal would be a welcome add-on acquisition to Credit Suisse’s existing business.
“Such a deal would certainly further invigorate Credit Suisse’s already strong prime brokerage franchise,” said Sal. Oppenheim analyst Javier Lodeiro. However, a transaction wouldn’t result in a re-rating of the stock, he said. Lodeiro has a neutral rating and a CHF55 price target on Credit Suisse stock.
Credit Suisse’s hedge fund services business Prime Services is part of its investment banking arm, which posted a third-quarter pretax profit of 1.75 billion Swiss francs ($1.68 billion) after a loss of CHF3.21 billion a year ago.
Prime Services is one of the business areas which have made “significant market share gains,” Credit Suisse said earlier this year.
