Credit Suisse sells 7% Aberdeen stake
Credit Suisse has sold its 7% stake in Aberdeen Asset Management, adding more than £200m to its third-quarter results.
Credit Suisse confirmed today it has sold 80.4m shares, which represent a near-complete exit of its investment in Aberdeen.
Credit Suisse initially had a 25% stake in the asset management company headed by chief executive Martin Gilbert (pictured), a position acquired after Aberdeen’s acquisition of various Credit Suisse asset management businesses.
Gilbert said it made sense for banks selling their asset management businesses to do “contribution deals”, such as his firm did with Credit Suisse. He said that deal had “worked very well”.
“You were buying was distribution to a certain extent, and Credit Suisse has one of the biggest private banks in the world, and gave us access to that. The balance of our business has dramatically moved.”
Speaking recently at the Fund Forum event, he added: “You then have a partnership with them in the deal. The way banks go about selling asset managers, by appointing an investment banks and having a process which is sending out a sales document to everyone in the world means the business value then falls sharply.”
A number of panellists joining Gilbert at the event agreed with him, that M&A among asset managers would continue this year. Indeed it already picked up since 2010, from 23 deals then, to 32 deals last year.
Aberdeen’s Gilbert said the widely expected impetus of banks selling asset management arms as they raise money to meet capital requirements was the opposite of what they should be doing “because asset management is the kind of business they should not be selling. Asset management is such a dependable stream of cash it seems crazy to sell the best business, but perhaps in these difficult times it is the only business they can sell, rather than going to market to raise cash.”
The sale follows the Swiss National Bank recommendation to Credit Suisse to supplement its capital by the end of the year