Three of France’s wealthiest dynasties including the owners of luxury giant Chanel are investing in Rothschild & Co. to help take the eponymous French bank private.
The Dassault, Peugeot and Wertheimer families, along with Giammaria Giuliani of Italy will back the offer by the Rothschilds’ holding company Concordia of €48.0 per share, reflecting a valuation of about €3.7 billion for the historic firm, according to a statement Monday. They will also be joined by the Maurel family, who were shareholders in the bank stemming from its previous merger with their finance company, and other members of the Rothschild clan.
The bank, predecessors of which helped finance the Duke of Wellington’s victory over Napoleon in 1815 at the battle of Waterloo, announced the outlines of the deal earlier this month. The families investing in Rothschild & Co. to take it private are among the most storied names in French capitalism, with the Dassaults’ fortune rooted in defense and aviation, the Peugeots in automaking and the Wertheimers in a luxury brand best known for tweed suits and Number 5 perfume.
“They share the same convictions toward development of a company like ours,” Francois Perol, a managing partner, said on a call with reporters. “These families all have relationships built on trust with the Rothschild family for different reasons.”
Concordia has argued that the bank’s businesses no longer need access to capital from public equity markets, and the step marks a further effort by the Rothschilds to cement control over the Paris-based firm. The “like-minded” investors backing the deal will be locked in for eight years, according to the statement.
Rothschild & Co. generates the majority of its revenue from providing financial advisory, though it also has a wealth and asset management unit as well as merchant banking business. Led by seventh-generation scion Alexandre de Rothschild since 2018, the bank has been expanding in the US and managed to sidestep much of the slump in the market for deal advisory, ranking 6th by the number of mergers and acquisitions last year.
Along with the confirmation of the offer details, the bank published full year net income that beat analyst estimates.
Going forward, Perol said the bank would continue to focus on the often-slower method of organic growth rather than externally.
Concordia said the price per share reflects a premium of 19% over the closing price on Feb. 3. Concordia already owns 38.9% of the firm’s shares and 47.5% of the voting rights. Rothschild’s shares have been trading at close to €47 since the plan was announced.
Following the de-listing, which could come at the end of August, Concordia would hold about 55% of the bank’s capital, the long-term investors with about 35% and the bank’s partners would have about 10%, according to Perol.
"the Rothschilds took their bank private by paying out all shareholders a 28% bonus to get it done as fast as possible a few weeks before the current crisis. media isn't mentioning it at all"
— vikram (@vikramh) March 25, 2023