• Rothschild majority owner wants to go public
• Squeeze-out for existing shareholders
• No more stock market capital required
On May 25th, at the annual general meeting of Rothschild & Co., the history of the Rothschild bank as a public company could come to an end.
Rothschild stock likely to be delisted
If the Rothschild family holding company has its way, Rothschild Bank & Co., which belongs to the French Rothschild Group, will soon no longer be publicly listed on the capital market. As announced by Rothschild & Co Concordia SAS, the company’s largest shareholder, existing Rothschild shareholders are to receive EUR 48 for each share as part of a simplified takeover offer. In addition, there is a regular dividend of EUR 1.40 per share. In addition, Concordia wants to lure the existing shareholders with a special dividend: As part of a special distribution, an additional 8 euros per share certificate is to be paid out, provided that the supervisory board approves the plans and the offer is successful.
Most shares family owned
Concordia holds 38.9 percent of the Rothschild shares and has 47.5 percent of the voting rights. If you add up the French, English and Swiss branches of the family and their shares in the bank, you come to 55 percent of the shares and 69 percent of the voting rights that can be exercised.
Against this background, a squeeze-out of the existing shareholders should be a mere formality.
According to the bank’s press release, Rothschild & Co. “takes note of the proposed transaction. In this context, its supervisory board has formed an ad hoc committee and, on the recommendation of the committee, has commissioned Finexsi as an independent expert with the task of establishing a report including a fairness opinion with regard to the financial terms of the simplified takeover offer and the special distribution.”
The market will be kept updated on the progress of the project, particularly around the upcoming full-year presentation on February 13, the press release further states. Concordia is currently in advanced negotiations with investors and banks to secure financing for the takeover. An offer should then be available by the end of the first half of the year, reports Bloomberg.
Capital market no longer necessary
Concordia also commented on the reasons for withdrawing from the Paris Stock Exchange. Access to capital from the stock markets is not necessary for any division of the Rothschild & Co Group, writes the majority shareholder. In addition, direct ownership of the group is more appropriate than a stock exchange listing, as this allows each business segment to be better valued on the basis of long-term results rather than short-term earnings.
Most recently, Rothschild & Co. had impressed with the presentation of its nine-month balance sheet. Revenues increased to EUR 2.238 billion in the first nine months of 2022; In 2021, sales in the comparable period were only 2.016 billion euros. The company described the increase as “solid sales development despite an uncertain and difficult environment”.
However, a listing is always associated with costs, and there are also regulatory requirements that listed companies have to comply with. The risk of activist investors interfering in matters of company strategy has also increased recently.
Editorial office finanzen.net
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