M&A
April 29, 2023
3 minutes read

Deutsche Bank To Buy U.K. Investment Bank Numis In $515M Deal

Deutsche Bank AG (ETR: DB), Germany’s biggest bank, has made a surprise move in the U.K. market. It has reached…

Deutsche Bank AG (ETR: DB), Germany’s biggest bank, has made a surprise move in the U.K. market. It has reached a deal to acquire Numis (LON: NUM), a British boutique investment bank, for £410mn ($515mn) in cash.

Numis marks Deutsche Bank’s largest acquisition in a decade. It also represents the German bank betting on a revival for its British business that has stalled in recent years. Under the deal’s terms, Deutsche Bank will combine its current U.K. and Ireland corporate finance teams with Numis. Deutsche has 35 employees in those teams, while Numis has 332 employees across its trading, research, and capital markets operations.

Deutsche’s acquisition price represents a 72% premium to Numis’s market value before the announcement. It includes 339 pence in cash for each share and two interim dividends of 6 pence and 5 pence to Numis shareholders. The acquisition marks a bright spot for the U.K. stock market, which has lagged behind global markets lately.

Numis’s revenue comes primarily from its investment banking division which charges fees for initial public offerings (IPOs), equity fundraisings, and mergers & acquisitions. The U.K. stock market drought weakened its business; Numis reported £144mn ($181mn) in revenue in 2022, compared to £216mn ($271mn) in 2021. Operating profits sank from £76mn ($96mn) in 2021 to £19mn ($24mn) in 2022.

In 2019, Deutsche Bank exited its global equities sales and trading business as part of a restructuring plan to boost profitability; acquiring Numis gets it back into that business, albeit on a small scale.

“We have been evaluating how to accelerate the growth of our business in the UK and Numis represents a compelling strategic fit,” Deutsche’s investment bank head, Fabrizio Campelli, said in a statement.