Rothschild & Co. to buy Martin Maurel, eyes French expansion

Bloomberg

Rothschild & Co., part of the banking dynasty focused on advising on mergers, is buying Compagnie Financiere Martin Maurel to expand its wealth-management and lending operations for French families and entrepreneurs.
The boards of both companies support the deal, which needs approval from shareholders and regulators, according to a joint statement on Monday. Marseille-based Martin Maurel has received irrevocable backing from a majority of its investors and the merger should be completed this year, creating a private bank with €34 billion ($39 billion) in assets under management in France.
“We are convinced that the association of our two houses will bolster the independent family-held banking model that makes our strength,” Bernard Maurel, chairman and CEO of Martin Maurel, said.
Rothschild in 2012 combined its French and U.K. units under Paris Orleans SA, a French publicly-traded company controlled by the banking dynasty that made its fortune financing the Duke of Wellington’s campaign against Napoleon almost 200 years ago. Paris Orleans was used by David and Eric de Rothschild to restart the business in 1982 after a Socialist government nationalized the family’s French bank in 1981.
Rothschild & Co. climbed as much as 7.3 percent in Paris trading, the most since August, and was up 4.7 percent at 24.41 euros as of 9:43 a.m.
Paris Orleans renamed itself Rothschild & Co. last year, a move criticized by Edmond de Rothschild group, the asset management and private banking firm led by Ariane de Rothschild and Benjamin de Rothschild.
The new merged entity will operate as Rothschild Martin Maurel in France and will seek to benefit from private-banking growth, especially in the Paris, Lyon and French Riviera regions, according to the statement. Rothschild & Co. should keep a core equity Tier 1 ratio under Basel III rules above 18 percent once the deal is completed. Under the agreement, Martin Maurel investors will receive 126 Rothschild & Co. shares for each share they own and there will also be a cash option. Martin Maurel is valued at €240 million, the companies said.