Robeco acquisition
'The acquisition of Robeco is
very good news, indeed,Heinz
Zimmer, Rabobank Zuricb.
The two groups
WHAT'S NewS Issue 7 July 1996
international expansion
3
Coritinued from page 1
It has been dubbed the deal of the decade, a perfect marriage. It made the front
pages of authorative papers like the Financial Times and Wall Street Journal. And
Rabobankers around the world, especially the private bankers, were gleeful at
the news. So what can Rabobank expect from this ideal marriage, and what is in
it for Robeco. Let's take a look at some of the details.
Korteweg and
Wijffels face the
press.
Commenting on the NLG 1 billion in
capitalization which the bank will make
available to Robeco for expansion,
chairman Pieter Korteweg says these funds
would be used primarily for acquisition of
other asset management companies. This
is essential if Robeco is to maintain and
grow its current position. Even though the
Group has NLG 76 billion under
management and markets itself as the
Jargest independent investment house in
Burope, in world stakes Robeco is not
(yet) a major player. For example, ING
'you only start to count as a real force in
the market when you reach at least NLG
100 billion under management. Anything
less and you're under pressure.'
PRIVATIZATION BOOST
In fact, the market for asset management
is a strong growth area. In the US alone,
around USD 15 billion in savings is put
into investment funds every month.
Similar trends - though not quite with this
kind of numbers - are visible in the
Netherlands, which is traditionally a
strong Robeco market. Increasing use of
private pension plans is only one
underlying cause. Another is the proposed
privatization of social security, not only in
the Netherlands, but also in other
European countries. But if Robeco is to
take full advantage of this growth market,
it will have to grow itself - and rapidly. To
reinforce Robeco's existing position,
Rabobank will be gradually transferring
its assets under management to the Group
in the near future. The bank will also be
providing the already mentioned finance
for further acquisitions by Robeco.
LOGICAL NEXT STEP
The advantages of a position as full
subsidiary of Rabobank seem clear. But
what does the acquisition mean for the
bank? 'It's actually a logical next step in
our existing cooperation,' says Wijffels.
'The two Groups complement each other,
especially in an environment where
Rabobank
balance-sheet total NLG 294 billion
assets under management NLG 76 billion
Asset Management has more than NLG
240 billion under management while a
single fund like Fidelity Magellan, one of
206 funds in the US Fidelity Group,
manages almost NLG 100 billion.
REAL FORCE
While Robeco has a fairly broad spread of
categories of investors (see What's in a
JX'ord, page 2), its funds tend to attract
Knaller, retail investors. The Group's four
biggest funds are Robeco and Rolinco
(both investing in shares), Rorento (fixed
interest instruments) and Rodamco (real
estate). 'In this business,' says Korteweg,
540 local
banks
Z" A
Rabobank Nederland
Robecam
Rabobank
International
~\C~
Schretlen
IR!S
Rotrusco
28 invest
ment funds
personnel
administration
control
De Lage
Landen
Nedship
Bank
^V_
Interpolis
_yv_
Roparco
n
Robeco
Securities
Bank
Foreign
branches
