Paris, Brussels, Luxembourg, 22 May 2001
The Boards of Directors of Dexia and Dexia Banque Internationale à Luxembourg
(Dexia BIL), at their meetings held on 22 May 2001 in Brussels, approved the
takeover bid for all the shares of Kempen&Co, listed on the Official Market
of the Stock Exchange of Euronext Amsterdam. Both the Supervisory Board and
the Management Board of Kempen&Co are unanimously in favour of Dexia BIL's bid.
1. Terms of the intended bid
- The intended bid is for 100% of the company's shares.
- The intended offer price is EUR 83.50 per Kempen&Co share, payable in cash.
- The intended premium amounts to 36% compared to the average price of the
past 40 trading days, being EUR 61.28.
- At the offer price, the company that is the object of the bid is valued
at 16 times its net profit for the year 2000 (EUR 66.221 mio) and at 4.75
times the value of its own capital (EUR 221.631 mio) at 31/12/2000.
- Dexia BIL is not obliged to proceed with the bid, unless amongst others
at least 95% of the shares are tendered.
- The acquisition of shares tendered is subject to the prior approval of the
competent Authorities, including the Commission de Surveillance du Secteur
Financier in Luxembourg and the Central Bank in The Netherlands and the relevant
The provisional time schedule is as follows:
- Offer memorandum: 11 June 2001
- Closing date: 09 July 2001
- Unconditional offer: 13 July 2001
2. Kempen&Co is a specialised banking establishment based in Amsterdam, founded
in 1903 and its first listing on the Amsterdam Stock Exchange dates back to
Currently, the shareholders of Kempen&Co known to the public are:
| Fortis NV
|Friesland Bank NV
| ING Group NV
| Acorn International
| ABN AMRO Holding NV
| CGU Plc./Delta Lloyd
|Stichting/Shell Pension Funds
| Henzada BV
At the end of 2000, Kempen&Co had a staff of 353, mostly employed at the bank's
head office in Amsterdam, but also employed at its offices in Antwerp, Geneva,
Edinburgh, and New York.
Kempen&Co is a well-established bank and is a recognised player in the field
of asset management, securities, brokerage and corporate finance.
In 2000, Kempen&Co posted total income of EUR 161.4 million (representing annual
growth of 42% over the previous 4 years), and net profits of EUR 66.2 million
(representing annual growth of 48% over the previous 4 years). Its profit per
share amounted to EUR 5.47 (+45% compared with 1999) and its return on equity
was 35% (30% in 1999). At the end of 2000, assets under management stood at
EUR 6.77 billion (on average +38.5% a year since 1996). In the Corporate Finance
advisory business, Kempen&Co is one of the specialists in medium-sized transactions
in the Netherlands, and in 2000, with its team of 47 professionals successfully
conducted some thirty transactions relating to advisory mandates for stock market
flotations, capital increases, mergers and acquisitions or other similar operations.
3. Dexia BIL is one of the principal subsidiaries of the Dexia group. Its head
office is in Luxembourg, where it is one of the leading banks in terms both
of balance sheet size and results. Its primary role within Dexia is to develop,
on a Europe-wide scale, the group's asset and customer base in the fields of
private banking, asset management and fund administration. These services, known
collectively as Investment Management Services are the subject of an intensive,
fast track strategy which has succeeded in placing the Dexia group among the
leading banking players in the euro-zone in terms of earnings from this business.
In 2000, net bank earnings from these services amounted to EUR 857 million (+42%
compared with 1999), and net profits stood at EUR 270 million (+30%). The growth
in this strategic sector for Dexia has been achieved both through internal growth
as well as through acquisitions, - the main acquisition being that of Bank Labouchere
in The Netherlands in the 2nd half of 2000. In 2000, investment management services,
one of Dexia's 3 core businesses, contributed 25% to Dexia's overall results.
The Dexia group is a major player in 2 other strategic areas. It is the world
leader in financial services to the local public sector, essentially via its
French subsidiary, Dexia Credit Local, and FSA in the United States; this business
contributed 40% to the group's result in 2000. In the area of retail financial
services (including bancassurance), the group has, through its Belgian subsidiary,
Dexia Banque, one of the strongest positions among retail banks. In 2000, total
bancassurance business represented 19% of the Dexia group's results, and this
percentage is set to increase once the acquisition of Artésia Banking Corporation,
announced in March 2001, has been achieved. Finally, in support of the group's
3 strategic businesses, a capital markets division (Dexia Financial Markets
- DFM) at the level of the Dexia Holding company steers strategy and monitors
related business. In 2000, financial market activity, including the credit enhancement
business of Asset Backed Securities (ABS) conducted by FSA, contributed 16%
to overall results.
In 2000, Dexia's profits totalled EUR 1001 million and it had a stock market
capitalisation of EUR 19 billion.
4. The planned acquisition of Kempen&Co is a natural extension of Dexia's three-pronged
strategy aimed at developing its investment management services. It will:
- add to the group's breadth of expertise in the area of securities
- underline its pan-European development policy, principally centred on France
and Benelux, Dexia's 'home base'
- provide synergies through the intended integration of the group's subsidiaries
in The Netherlands.
This development simultaneously meets the changing needs of the group's target
clients in the domain of securities investments and the objectives of optimising
the exploitation of resources and creation of value for shareholders.
broaden expertise: the growing demands of European customers for private banking
services - particularly at the top end of the market - and for asset management
services have resulted in the need for a stronger reputation and enhanced operational
effectiveness in the catchment area. Kempen&Co will bolster the Dexia group
in several ways. The bank possesses specialist knowledge of the Dutch market
thanks to its research teams whose skills are highly regarded in certain key
sectors (property, TMT, food and food retail, and temporary employment.) In
addition, its Corporate Finance team is actively and widely involved in Dutch
corporate circles and, accordingly, enjoys a quality of information and experience
which makes Kempen&Co an important player. Finally, Kempen&Co's position in
the equities brokerage market gives Dexia a window of opportunity from which
to develop the equity and derivatives market. Mastery and expertise is indispensable
for the effective and credible conduct of securities business, whether in the
form of collective investment funds or for high net worth individuals or institutional
Reinforcing Dexia's presence in its 'home base': since its creation in 1996,
Dexia has consciously chosen to be a pan-European bank, centred mainly in the
region of France/Benelux to start with. The recent linking up of the Paris,
Brussels and Amsterdam exchanges to create Euronext confirms that this region
- often referred to as Europe's 'money belt' - can be seen as an economic and
financial block and demonstrates that it has one of the most important savings
pools to be tapped. The Dexia group's priority is now to reinforce its position
in the investment management field in the financial centres of Paris (where
the acquisition, announced in February 2001, of la Financière Opale and its
principal subsidiary, ODB, a specialist in equity and derivatives brokerage
should be finalised shortly) and Amsterdam.
Synergies/Integration: once the Kempen&Co deal has gone through, bar any unforeseen
occurrence, the Dexia group will have 2 main entities in the Netherlands which
it will seek to integrate:
- Labouchere, acquired in the 2nd quarter of 2000, whose principal business
is the distribution of an innovative equity savings product (Legiolease) to
wealthy clients representing about 300 000 households, and its subsidiary
Alex, a specialist online broker which within only 2 years of its launch is
the market leader in The Netherlands, handling transactions on behalf of 42000
- Kempen&Co, whose business has been described above.
5. Integration and development plan
- The financial characteristics of the companies to be integrated are summarised
|Total income (M EUR)
|Net profit (M EUR)
|Offices in The Netherlands
- It is currently anticipated that the intended integration of Labouchere
and Kempen&Co will take place in the form of a merger. The merged company
will be placed under one operational company in the Netherlands. The Supervisory
Board will be headed by André Roelants, Dexia BIL's CEO, member of Dexia's
Executive Board and head of Investment services on this Board. The Management
Board will be headed by Joseph Krant.
- The business of the new integrated company will be provided by means of
an 'Equity markets' centre (Dexia Equities), which will supply the necessary
expertise to back up the group's Investment Management Services. Its principal
tasks will be:
- To rationalise and optimise circuits for executing order flows from
the group's different retail brokerage customers
- To develop securities brockerage on the markets of Amsterdam (via Kempen&Co),
Paris (via ODB), Brussels and Frankfurt (via Dexia BIL Luxembourg), for
- Equally, to develop institutional distribution services by exploiting
all possible synergies existing between the client bases of Dexiam, Dexia
Fund Services and FETA
- To expand equity research capabilities by exploiting all potential gateways
to the top quality information that is available from different areas
of the group so as to provide added value to managers running collective,
institutional and individual investment portfolios, without competing
with the major global research firms.
- To pursue the development of Corporate Finance business aimed at medium-sized
transactions and in markets where the group's distinctive advantage can
- The financial markets division (Dexia Financial Markets), which co-ordinates
and controls the strategy at the level of the Dexia Holding company of
all financial markets business of the different group entities, has the
task of fixing intervention standards for Dexia Equities: drawing up control
procedures, and allocating capital resources, in connection with transactions
likely to involve risk taking (negotiations, flotations, secondary issues,
financing), in line with Dexia's risk policy.
6. Financial impact on the Dexia group of the takeover bid for Kempen&Co
- Supposing that the takeover bid is 100% successful, the Dexia group will
invest a total of EUR 1,053 million.
- The resulting consolidated goodwill for the Dexia group will amount to approximately
EUR 830 million. It is expected that the approval of the supervisory authorities
will be sought for the application of the pooling of interests policy, which
allows the direct deduction of consolidated goodwill, as was the case for
the last 3 comparable acquisitions made by the group (FSA, Labouchere and
- The acquisition will be financed without issuing new Dexia shares. A sum
of EUR 500 million Hybrid Tier One Capital will be raised on the market towards
mid 2001. The ratio of Tier One capital, which was 9.34% at 31 December 2000
should, taking into account all operations realised in 2001, be on a level
in line with the group's objectives, that is, above 8.5% for Tier One excluding
synthetic capital and above 9.0% for eligible Tier One.
- Expected synergies from the transaction are estimated at EUR 40 million,
per annum, to be achieved in two to three years generated by savings of resources
(EUR 15 million), and a proportion generated by revenue growth (EUR 25 million).
This level of synergies could be attained from 2004 onwards.
- Likewise, Dexia's return on equity will not undergo any dilution as a result
of this acquisition
7. For further information
- On Kempen&Co - http://www.Kempen.nl
- On Dexia BIL and Dexia - http://www.dexia.com
- On the transaction:
- Françoise Lefebvre tel: (33) 1 43 92 80 20
- Guy Bertemes tél: (352) 4590 3879