Deutsche Börse Group has confirmed it is in exclusive discussions to acquire Amsterdam-listed Allfunds Group plc in a deal that could be valued around €4.7 billion.
Deutsche Börse said the non-binding proposal currently under discussion implies a total consideration of €8.80 per Allfunds share, comprising €4.30 in cash and €4.30 in new Deutsche Börse Group shares “based on Deutsche Börse Group’s undisturbed 10-day VWAP, plus a permitted dividend in respect of financial year 2025 of €0.20 per Allfunds share.”
In addition, it is expected that Allfunds shareholders would also be entitled to receive cash dividends, pro-rated as at the date of closing, of up to €0.20 per Allfunds share for the financial year 2026 and €0.10 per Allfunds share per quarter during the financial year 2027.
That equates to a value of about €4.7 billion.
US tech investor Hellman & Friedman and French bank BNP Paribas are the largest shareholders in Allfunds Group, a UK-Spanish company that went public in 2021.
Talks between Hellman & Friedman and the financial investor CVC failed.
Also, in recent years Switzerland-based European regional stock exchange operator SIX Exchange Group and French exchange group Euronext had expressed interest in acquiring Allfunds.
“Deutsche Börse Group notes recent market speculation and confirms that it is in exclusive discussions with Allfunds Group PLC regarding a possible acquisition of the entire issued and to be issued share capital of Allfunds,” said Deutsche Börse.
“The board of directors of Allfunds has unanimously agreed to Allfunds entering into exclusivity on the basis of the Non-binding proposal put forward by Deutsche Börse Group.
“The announcement of any binding offer relating to a possible acquisition is subject to the satisfaction or waiver of a number of customary pre-conditions, including, amongst other things, the satisfactory completion of customary due diligence in respect of Allfunds, the finalization of definitive transaction documentation and final approval of the Deutsche Börse and Allfunds Boards.
“Deutsche Börse Group believes in the strong strategic, commercial and financial rationale of combining Allfunds with Deutsche Börse Group’s fund services business segment.
“This potential business combination would represent a further successful consolidation, establishing a truly pan-European ecosystem.
“It would reduce fragmentation in the European investment fund industry and create a harmonized business with global reach, playing a key role in further facilitating the investment of retail savings into productive capital allocations such as investment funds.
“The combination is expected to deliver substantial operational efficiencies and cost synergies across platforms and services, enable the rationalization of investment capacity, and drive further innovation for clients with even faster time-to-market.
“Overall, it is expected that clients and the EU equity markets would significantly benefit from the strengthened set-up of such a combined platform.
“Deutsche Börse Group is a strong advocate of a prospering funds industry being essential to the EU’s status as a globally relevant financial center.
“The proposed transaction would be in line with Deutsche Börse’s strategy and further emphasizes its ongoing commitment and efforts to strengthen European capital markets and its global competitiveness as envisioned by the Savings and Investments Union (SIU) …
“It is expected that the combination of Deutsche Börse Group and Allfunds would be effected through a scheme of arrangement under Part 26 of the UK Companies Act 2006.
“There can be no certainty that any transaction will proceed, nor as to the terms or timing of any such transaction. Any transaction would be subject to regulatory approvals. A further announcement will be made as and when appropriate.”