Rothschild, Martin Maurel plan France tie-up

Rothschild & Co and Compagnie Financiere Martin Maurel (CFMM) plan to merge their French operations, creating an independent private bank in France with combined assets under management (AuM) of €34bn.

The new combined group, which still required shareholder and regulatory approval, would operate under the name Rothschild Martin Maurel in France, the companies said in a joint statement today.

Directors of both companies supported the deal. Marseille-based Martin Maurel has irrevocable backing from a majority of its investors. The deal was expected to complete this year.

Shareholders in CFMM would be offered either 126 Rothschild shares per existing share, or, prior to the completion of the merger, be able to sell their CFMM shares in cash.

The Maurel family would receive Rothschild shares and as a result of the merger, would replace CFMM in the extended family concert.

The proposed tie-up would create an independent bank offering wealth and asset management, financing and corporate advisory services. It would be financed by a mix of new Rothschild shares, cash resources and external credit facilities.

CFMM is valued at €240m, with the 2015 dividend attached.

The transaction is expected to have a modestly positive impact on EPS from the first full fiscal year post-merger, before synergies.

Private banking and asset management activities are one of three arms of Rothschild, which represented €50bn of AuM on a worldwide basis, with €24bn of AuM in France of which €10bn was in private banking.

The Martin Maurel Group has almost €10bn of AuM, of which €7bn was for private banking at end-2015.

The companies said the planned merger would build upon a relationship between the Rothschild and Maurel families, which dated back three generations. The two companies also enjoyed close links.