The European Commission has cleared the acquisition of Belgium’s largest private bank Degroof Petercam by CA Indosuez, a subsidiary of the Paris-based Crédit Agricole group.
The Commission said on Monday that it concluded that the proposed concentration does not raise competition concerns given the limited market positions of the companies involved.
In August, Credit Agricole announced it was acquiring some 80 percent of the shares of Degroof Petercam from several families at a price of 145 euros per share. This gives the transaction a value of 1.55 billion euros.
The alliance between Degroof Petercam, which manages around 71 billion euro in assets, and Indosuez Wealth Management, with 135 billion euro in assets under management, aims to create a pan-European leader in wealth management, take advantage of global growth opportunities and position itself as a consolidator in the European market.
Six Belgian families selling
Until the transaction is completed, Degroof is still majority owned by a group of Belgian shareholders, including Guimard Finance, CLdN Finance and the Belgian families Philippson, Siaens, Schockert, Haegelsteen, Peterbroeck and Van Campenhout. Together, they own more than 72 per cent of the company, while a group of unidentified “financial partners” owns about 22 per cent.
Degroof Petercam’s history dates back to 1871. The firm employs about 1,400 people, more than 400 of whom work from Luxembourg. The company was created in 2015 by the merger of Degroof and Petercam.
The board of directors has since been made up of representatives of the families that owned the shares, including Baron Alain Philippson, whose grandfather founded Degroof in 1871 and who stayed with the company for more than 45 years. Although he retired in 2020, Alain Philippson, born in 1939, is still a director.
Money laundering
Although it remained profitable, Degroof has struggled in recent years to meet increasingly stringent anti-money laundering requirements in an increasingly competitive landscape under pressure from strict regulation.
Luxembourg’s financial regulator CSSF imposed a €1.56 million fine in December last year after the company “failed to meet its professional obligations”. The fine remains the second highest ever imposed by the CSSF.
Related articles on Investment Officer:
- CA Indosuez takes majority stake in Degroof Petercam
- Owners of Degroof Petercam want to sell their shares
- CSSF fines Degroof Petercam €1.56 mln for ‘deficiencies’