Intertrust Climbs on Deal to Buy Elian for $625 Millionby
Intertrust NV shares climbed after the provider of legal and corporate services said it’s buying Jersey-based competitor Elian Group for 435 million pounds ($625 million).
Intertrust will purchase Elian from private-equity firm Electra Partners LLP, the Amsterdam-based company said in a statement on Monday. The deal will significantly increase Intertrust’s business in the U.K., Ireland and Spain, according to the statement.
“Consolidation in our industry continues, and the ability of global trust and corporate-services providers to acquire high-quality companies will determine their success going forward,” Intertrust Chief Executive Officer David de Buck said in the statement.
Intertrust rose as much as 5.4 percent, the most since Feb. 15, and was trading at 18.83 euros ($21.4) in Amsterdam at 10am.
The Netherlands’ lenient fiscal policies and network of tax treaties has fostered a sizable industry of so-called trust firms. Among its services, Intertrust helps set up local addresses for multinational companies. Trust firms also provide non tax-related services, such as bookkeeping and payroll administration.
“Synergies will come from a reduction in overlapping support functions, savings on insurance policies, regulatory costs and professional services, rationalization of duplicate locations and cross-selling across client networks,” Simon Mezzanote and Josh Puddle, analysts at Berenberg Bank, wrote in a note to clients about the transaction on Monday. They have a buy rating on Intertrust.
Intertrust, which Blackstone Group LP bought in 2012, sold stock in October in Amsterdam to expand and reduce its debt as tougher international scrutiny of tax-avoidance may hamper new business.