Bank of Ireland has completed the acquisition of J&E Davy, Ireland’s leading provider of wealth management and capital markets services.
The takeover, announced in July 2021, was given the go-ahead recently by the Competition and Consumer Protection Commission.
Davy was previously owned by Bank of Ireland before being spun out years ago.
Davy has assets under management of c.€20bn while the bank has Wealth & Insurance AUM of c.€22.5bn.
In a statement BofI declared: “The acquisition of Davy provides significant scale and breadth of proposition. In addition it enhances the combined services available to the group’s corporate clients, across both companies, and provides further opportunities for growth.
In Association with
"Along with the KBC Bank Ireland portfolios transaction, which recently received CCPC approval, completion of this acquisition demonstrates further strategic progress by the group.”
Davy has been acquired for a final consideration of c.€427m after adjusting for the capital position of Davy as of 1 June 2022.
25% (€107m) of the enterprise value will be paid two years after completion, subject to Davy shareholders meeting a number of agreed criteria.
Bank of Ireland will also pay for excess cash which amounts to c.€126m, following the sale earlier this year of Davy Global Fund Management and Davy’s shareholding in Rize ETF.
A further payment of up to €40m will be payable from 2025, contingent on future business model performance.
The bank said the CET1 capital ratio impact of the acquisition is c.80 basis points, financed through existing resources.
“Acquiring Davy will materially increase the group’s wealth and fee income, and the acquisition is expected to be accretive to earnings in the first full year of ownership, excluding transaction related payments,” the bank stated.
Departing bank group chief executive Francesca McDonagh commented: “As the unrivalled Irish leader in wealth management and capital markets, we are ambitious for the future of Davy within the group.
“The completion of the deal today represents a fantastic addition to our franchise and business model. Clients from both organisations will benefit over time from enhanced product and service offerings from our businesses, two organisations with long histories of supporting clients across the personal, business and corporate landscape in Ireland.”
Bernard Byrne, chief executive of Davy, added: “This is an exciting milestone for both organisations and an opportunity for us to materially enhance the support we can give our clients with their growth plans and ambitions. We are confident for the future as we work with the bank on the next phase of our journey.”
