Julius Baer Jumps on M&A Speculation Before Four-Month Statement

Julius Baer Group Ltd. jumped in the first day of trading since Intesa Sanpaolo SpA said it was looking to buy a private bank and as some analysts commented on the stock before a company statement next week.

Julius Baer rose as much as 4.8 percent, the most in more than five weeks, and was up 2.8 percent to 50.25 francs at 3:49 p.m. on Friday in Zurich. Intesa Sanpaolo was 1.2 percent higher at 3.33 euros.

On Thursday, Italy’s second-biggest bank said it was seeking to buy an international private bank with a market value similar or lower than its own private banking division. Chief Executive Officer Carlo Messina said his division is valued at 10 billion euros ($11.4 billion) to 15 billion euros. He didn’t mention Julius Baer and said he has “nothing on the table” regarding such deals in a televised interview with Bloomberg.

His comments came on a Swiss holiday, when markets in the country were closed. Julius Baer has a market value of about 11.3 billion francs ($12.2 billion).

Julius Baer’s stock has been buffeted for months by speculation that it may be an acquisition target. In early April, it rose the most since it began trading in its current form five years ago, amid speculation that Credit Suisse Group AG is eyeing the bank. Credit Suisse declined to comment at the time.

Julius Baer CEO Boris Collardi reiterated in April that the company is big enough to grow on its own, echoing comments earlier this year that Switzerland’s third-largest wealth manager isn’t for sale.

‘Consolidator of Choice’

Julius Baer plans to publish a business update statement for the first four months of the year on Tuesday.

Morgan Stanley analysts led by Huw Van Steenis expect the firm to benefit from cost-cutting plans announced in the first quarter, client inflows from Asia and the conclusion of the integration of Merrill Lynch units acquired from Bank of America Corp., according to a note dated Thursday and delivered to clients Friday. Those positive factors help compensate for tax and legal issues, Morgan Stanley said.

Julius Baer is under investigation in the U.S. over allegations it helped Americans evade taxes. It expects a fine in connection with the probe, the bank has said.

Contrary to speculation that Julius Baer might be acquired, Morgan Stanley said it continues to see Julius Baer as the “consolidator of choice in Switzerland.”

Julius Baer has focused on banking for wealthy individuals and families since it split from its institutional asset management unit in 2009. Acquisitions and investing in private-banking networks in Asia helped Julius Baer boost assets under management by 89 percent to 291 billion Swiss francs at the end of December from five years ago, when Collardi became CEO. About half of those assets are in “growth markets” such as Asia, according to the company.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE