EFG International to pay $1.83b to acquire BTG Pactual's BSI

ZURICH • Swiss investment bank EFG International said yesterday it would dish out 1.3 billion Swiss francs (S$1.83 billion) to take over competitor BSI, owned by Brazil's BTG Pactual group, to create one of Switzerland's largest private banks.

EFG, which is controlled by the Greek Latsis family, said in a statement it would pay the amount in cash and shares for Banca Svizerra Italiana, or BSI.

Once the deal is concluded, BSI's parent group Pactual will end up holding 20 per cent of EFG, it said, stressing though that the EFG Group would remain the largest shareholder with more than 35 per cent of the stock.

By combining the two banks, EFG will "become one of the largest private banks in Switzerland with approximately 170 billion Swiss francs in assets under management".

By combining the two banks, EFG will "become one of the largest private banks in Switzerland with approximately 170 billion Swiss francs in assets under management", it said.

It insisted that this would allow it to gain "a significant competitive position in the growing global wealth management market".

The deal, which still requires approval by regulators, is expected to close in the fourth quarter, the statement said.

BSI was established in the Italian-speaking city of Lugano in 1873, making it one of Switzerland's oldest banks, and today counts some 1,900 employees worldwide.

At the end of June last year, it had 81.8 billion Swiss francs under management, down from 92.3 billion at the end of 2014. BSI was snapped up by BTG Pactual only last September, when the Brazilian group bought it from Italian Generali for 1.25 billion Swiss francs.

BTG Pactual is owned by billionaire Andre Esteves, who was arrested late last year on charges related to Brazil's huge Petrobras corruption probe, forcing him to resign as the company's chairman and chief executive.

EFG International, which is listed on the Swiss stock exchange, meanwhile counts some 2,200 employees across 30 locations worldwide.

At the end of October last year, the bank had some 83.4 billion Swiss francs under management, up 4 per cent from four months earlier.

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A version of this article appeared in the print edition of The Straits Times on February 23, 2016, with the headline 'EFG International to pay $1.83b to acquire BTG Pactual's BSI'. Print Edition | Subscribe