Dexia Holding SA · EURONEXT:DEXB
Dexia Holding SA — Merger or Acquisition (May 2001)
25 slides from Dexia Holding SA's merger presentation, May 22, 2001
Slide 1: Acquisition of Kempen&Co
Acquisition of Kempen&Co Adding to the expertise in Investment Management Services May 22, 2001
Slide 2: Transaction summary
Transaction summary ✔ Public tender bid on 100% of Kempen&Co’s shares ✔ Offering price: 83.50 € p. share ✔ Premium: 36% over average stock price (last 40 days) ✔ Total consideration: 1 053M€ in cash ✔ Time table: Offer Memorandum Mid June 2001 Closing date 9 July 2001 Unconditional offer 13 July 200
Slide 3: A profitable and growing company ...
A profitable and growing company ... 00 99 98 97 96 CAGR Revenues (M€) 161 108 105 61 40 +42% Net Profit (M€) 66.2 43.8 44.6 25.2 13.7 +48.2% C/I ratio 39.9% 41.8% 37.8% 40.0% 50.1% ROE 35% 30% 41% 39% 27% AuM (Bn€) 6.77 5.22 3.97 3.14 1.84 +38.5% 3
Slide 4: … well regarded by the investment community...
… well regarded by the investment community... Recent research quotes: ✘ ABN AMRO “Go where the growth is” 15.02.01 Add ✘ Julius BAER “Kempen&Co well positioned in growth markets” 29.11.00 Buy ✘ SG Equities “Once you start gathering, you can’t stop” 03.01 Strong buy 4
Slide 5: and well positioned within its peer group
and well positioned within its peer group Market Cap/ ROE sustainable* Oper. Profit 2001(e)** Van Lanschot 17% 8.9 X Bank Sarasin 21% 8.5 X VPB Vaduz 17% n.a. Vontobel 26% 8.7 X Julius Bär n.a. 9.6 X Average Peer group 20% 8.9 X Kempen&Co 25% 6.8 X * Source: Julius Bär Research ** Source: SG Equitie
Slide 6: A well balanced business portfolio...
A well balanced business portfolio... Revenue by activity in 2000 Total: 161 M€ 17% 20% Corporate Finance (e) Securities Brokerage Asset Management 28% 35% (e) Other (trading income) 6
Slide 7: Asset Management / Private Banking
Asset Management / Private Banking A core Expertise of 129 Professionals Private customers (HNWI) (+32%) Collective Funds (+19%) 1.66 Bn€ 2.57 Bn€ 2.54 Bn€ Institutional (+41%) l At December 2000, total AuM = 6.77 Bn€ (+30%) “New Money” in 2000 = 1.18 Bn€ 7
Slide 8: Corporate Finance
Corporate Finance ë A relationship business, developed as an extension of the Private Banking franchise IPO’s, M+A, Corporate Finance Advisory Services, Privatisations, Private Placements, Shares Buy-backs, Valuations... ë A recognized player in small, mid-caps and property companies 35 deals in 199
Slide 9: The acquisition rationale
The acquisition rationale ë Develop knowledge and presence in equity-related activities whilst modifying only marginally Dexia risk profile ë Generate integration benefits ë Reinforce Dexia franchise in its home base, i.e. the Benelux and France 9
Slide 10: Develop Dexia franchise in the Netherlands
Develop Dexia franchise in the Netherlands K em pen& Co l Private Banking l Private Banking (HNWI) l Asset Management (1.4 Bn€) l Share leasing l Institutional Asset Management (300,000 customers) (6.8 Bn€) l On line Brokerage (Alex) (42,000 customers) l Equities Broking l Equity Broking l Corporate
Slide 11: Achieve integration benefits in the Netherlands
Achieve integration benefits in the Netherlands Labouchere Kempen&Co (2000) (2000) Revenues (M€) 339 161 Net Profit (M€) 118 66 C/I ratio 47% 40% Staff Numbers 899 353 Number of offices in the NL 10 2 ë Cost synergies estimated at 15 M€ from 2004 11
Slide 12: Organisational Implications
Organisational Implications ë Merger and “co-location” of Labouchere and Kempen&Co ë Setting up of “Dexia Equities” ë Integration plan of IMS becomes the new priority 12
Slide 13: Business Mission of Dexia Equities
Business Mission of Dexia Equities ë Rationalize and Optimize execution functions throughout all order- generating units ë Develop distribution and block trading services with existing institutional client base l Paris (ODB) l Amsterdam (Kempen&Co) l Frankfurt & Brussels (Dexia-BIL Luxemburg) ë Use
Slide 14: IMS' integration plan becomes the new priority
IMS’ integration plan, following recent acquisitions becomes the new priority Fin. Bancoval K em pen& Opale Co Asset Management Fund Administration Dexiam Crediop DFS FETA Bancoval K em pen& CORDIUS Co CORDIUS Private Banking Equities / Brokerage Fin. Opale ALEX Dexia BIL K em pen& Co Fin. K em pen&
Slide 15: Financial impacts
Financial impacts l Synergies and Return on Investment l Goodwill l Tier one ratio l EPS l ROE 15
Slide 16: Synergies and ROI
Synergies and ROI (before tax) l Revenue synergies = 25 M€ achievable in 2004 l Cost synergies = 15 M€ achievable in 2004 Total synergies = 40 M€ l Earnings estimate = 85 M€ * l ROI = 10% Transaction will be economically accretive, in view of Dexia cost of capital *average for 2002 of SG Equities, J
Slide 17: Impact on EPS, ROE and capital ratios
Impact on EPS ROE and capital ratios l EPS (2001) before synergies after synergies Before Goodwill + 1.78 % + 2.41 % After Goodwill - 1.61 % - 0.98 % Accretive as from 2002 after synergies l Impact on ROE (2001 after Goodwill) - 0.43 % l Impact on Tier one (2001) - 0.18 % 17
Slide 18: Appendices
Appendices
Slide 19: Kempen&Co's shareholding
Kempen&Co’s shareholding ✔ Kempen&Co listed on Euronext (Amsterdam) ✔ Current shareholding (at Feb./March 2001) ✘ Fortis N.V. 20.1% ✘ Friesland Bank N.V. 11.6% ✘ ING Groep N.V. 8.4% ✘ Acorn International 6.3% ✘ Iton B.V./J. Krant 6.0% ✘ ABN Amro Holding N.V. 6.0% ✘ CGU/Delta Lloyd 5.3% ✘ Stichting S
Slide 20: Equity broking
Equity broking “One of the big second tier players in Dutch broking”* ë Substantial market share of Euronext Amsterdam ë 82 front office professionals ë Research teams reknown in food retail and manufacturing, TMT, temporary employment, real estate, energy ë Brokerage fees represent the majority of
Slide 21: Management
Management ë Four senior Management Board members, with outstanding reputation and recognized expertise, have developed the company over the last 10 years Joop Krant (52), Evert Greup (45), Chris Vlek (53) ë Partnership model with performance-linked income l Variable component paid in non voting sha
Slide 22: Acquisition of Kempen&Co complements IMS Business Portfolio
Acquisition of Kempen&Co complements IMS Business Portfolio whilst modifying only marginally Dexia risk profile High Equity H ISE (Counterparty, Market, Operational) RAN C Trading H EF UE OF T Kempen&Co VAL Business Risk Equity Leasing Private Banking Labouchere Dexia BIL Equity Broking Corporate E-
Slide 23: Performance of funds
Performance of funds Fund Dec-00 YTD Average per Outerformance year since start benchmark Kempen European Largecap Fund -1.1% n.a. n.a. 4% Kempen European Midcap Fund 0.1% 15% 35% 24% Kempen European Smallcap Fund 2.9% 28% 35% 23% Kempen European NM. Companies Fund -0.5% 30% 73% n.a. Kempen Largecap
Slide 24: Selection of corporate deals during 2000
Selection of corporate deals during 2000 Company name Transaction details l Issues KPN Offering, co-lead manager, €4,000m Ahold Offering pref. Shares, lead manager, €404m BESI Offering and sec. Offering, co-lead manager, €325m Wegener Offering of shares, pref. Shares and convertibles, co-lead manage
Slide 25: Equity volume Euronext Amsterdam (€bn)
Equity volume Euronext Amsterdam (€bn) 1600 1400 1200 1000 800 600 400 200 0 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 Source: Euronext Amsterdam 25