UBS to sell majority stake in UBS Fondcenter to Clearstream

Maria Nikolova

Upon closing of the deal, UBS expects to recognize a post-tax gain of approximately $600 million and a CET1 capital increase of approximately $400 million.

UBS Group AG (SWX:UBSG) and UBS AG today announce an agreement to sell a 51.2% stake in UBS Fondcenter to Deutsche Börse Group’s post-trade services provider Clearstream.

UBS will initially retain a minority (48.8%) shareholding in the combined business and will enter into an agreement under which it may sell its remaining shareholding to Clearstream at a later time.

Following the completion of the transaction, Fondcenter will be combined with Clearstream’s Fund Desk business, creating a major B2B fund distribution platform with a presence in Europe, Switzerland and Asia. The newly-combined business, to be called Fondcenter, is set to have $230 billion in AuA and connect approximately 340 distribution partners with more than 450 fund providers, with over 75,000 investment funds and share classes available globally.

As part of the transaction, UBS and Clearstream will enter into long-term commercial cooperation arrangements for the provision of services to UBS’s Global Wealth Management and Asset Management business divisions and the Corporate and Institutional Clients unit of Personal & Corporate Banking.

The employees of Fondcenter will transfer to Clearstream as part of the sale. The management team will take senior positions within the combined business, providing continuity for clients and fund providers.

The transaction is subject to customary closing conditions and is anticipated to close in the second half of 2020. Upon closing, UBS expects to recognize a post-tax gain of approximately $600 million and a CET1 capital increase of approximately $400 million. UBS will deconsolidate Fondcenter and account for its minority interest as an investment in an associate.

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