Van Lanschot makes bid for Kempen (NL)

F. van Lanschot Bankiers NV ("Van Lanschot"), the oldest independent bank in the Netherlands, intends to submit a bid for the Dutch merchant bank Kempen & Co ("Kempen"). Kempen's Management Board and Supervisory Board support the bid and will recommend it to the shareholders.

Both Van Lanschot and Kempen regularly conducted exploratory talks in the past. In the spring, the two banks initiated constructive talks. This intended acquisition will join up two banks whose product and service offerings complement each other well.

An independent top-segment niche bank, Kempen complements Van Lanschot's position in the market. Van Lanschot recently presented its refocused strategy. The concept of the "Full-service Niche Bank" offers clients high-quality services. Van Lanschot primarily targets high net-worth individuals, institutional investors, businesses and entrepreneurs.

It is Van Lanschot's ambition to achieve strong growth in the asset management segment. This acquisition is set to more than double assets under management. The new combination's asset management team will be made up of 120 professionals. Traditionally, Van Lanschot has been strong in fixed-interest funds, whilst Kempen manages strong real estate and small and midcap funds (including the Orange Funds).

In addition, Kempen holds an excellent position in corporate finance, which services will become available to Van Lanschot clients. This is relevant in particular for larger family businesses and organisations in the healthcare sector.

Kempen Securities focuses mainly on securities brokerage for professional investors in Europe and the US; it will join forces with Van Lanschot's brokerage activities. In addition, Kempen clients will be able to benefit from the expertise of the European Securities Network (ESN).

The acquisition price is €300 million (of which around €240 million goodwill). Of this amount, approximately €110 million will be paid in shares and approximately €190 million will be paid in cash. To strengthen Van Lanschot's financial position, shares will be issued to the tune of approximately €70 million, in addition to the payment of about €110 million in shares to Kempen's shareholders.

The acquisition is expected to result in €10 to 20 million in synergies from 2008 onwards, the majority of which will be attributable to additional income.

This transaction requires the collaboration of the Kempen shareholders and is subject to the approval of the competent regulatory authorities. The transaction is expected to be completed in January 2007.

After the transaction has been completed, Kempen will continue to enjoy a high degree of independence within the Van Lanschot Group. The Van Lanschot activities in the fields of institutional asset management and institutional brokerage (including research) will be combined with the Kempen activities.

It has been proposed to the Supervisory Board that, subject to the approval of the Dutch Central Bank, Mr I.A. (Ieko) Sevinga be appointed to the Board of Managing Directors of Van Lanschot.

F.G.H. (Floris) Deckers, Chairman of the Board of Managing Directors of Van Lanschot, comments: "Today, we are taking a major step towards realising our strategy. This acquisition is good news for our clients, and therefore also for our shareholders and employees. We are very much looking forward to joining forces with our new colleagues at Kempen, which will undoubtedly create added value for our shareholders."

W.H.M. (Wiet) Pot, Chairman of the Management Board of Kempen, comments: "Van Lanschot is a fantastic bank that will offer our clients access to additional products and services. We are convinced that our own strength and culture will thrive within the Van Lanschot group. In our strategic explorations, Van Lanschot has been flagged as the ideal partner for some time now. That is why we are pleased that our intensive talks have now led to this bid by Van Lanschot."

Source: Van Lanschot

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