Julius Baer May Be Takeover Target

Zurich-based UBS on Friday said it plans to shed its 20.7 % stake in private Swiss bank Julius Baer, which the world’s fifth-largest bank acquired as part of a 2005 financing deal involving the sale of three private banks and a hedge fund. Baer’s modest size and quickly growing business make it a takeover target analysts told Reuters. “There are more people that are interested than people who are not interested, and UBS could certainly sell (the stake) at a premium when there is a single investor,” said Dirk Becker, an analyst at Kepler Equities. The market value of Julius Baer is estimated at about $16 billion. Baer, which holds $30 trillion in assets, is Switzerland’s third largest wealth manager and has been growing quickly especially in Asia.  One way a buyer might finance the deal would be to jettison Baer’s GAM hedge fund, Reuters quotes one anonymous source as suggesting. Global entities including Citigroup, HSBC, Barclays, and Deutsche Bank are each looking to grow their wealth management businesses. In an effort from giving a boost to any such competitors, one Helvea analyst suggested UBS will sell its stake either to a group of institutional shareholders or to Baer itself.   The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.