Van Lanschot makes bid for Kempen

• the extension of the range of products and services
• the strengthening of the distribution force and network

• Acquisition price of EUR 300 million
• Payment partially in cash (EUR 190 million), partially in shares (EUR 110 million)
• The cash payment will be funded by an additional share issue to the tune of
  EUR 70 million
• Kempen will immediately contribute positively to 2007 EPS

• The acquisition is expected to result in EUR 10 to 20 million in synergies from 2008 onwards, the majority of which will be attributable to additional income

F.G.H. (Floris) Deckers, chairman of the Board of Managing Directors of Van Lanschot: "Today, we are taking a major step towards realising our strategy. This acquisition is good news for our clients, and therefore also for our shareholders and employees. We are very much looking forward to joining forces with our new colleagues at Kempen, which will undoubtedly create added value for our shareholders."

 

W.H.M. (Wiet) Pot, chairman of the Management Board of Kempen: "Van Lanschot is a fantastic bank that will offer our clients access to additional products and services. We are convinced that our own strength and culture will thrive within the Van Lanschot group. In our strategic explorations, Van Lanschot has been flagged as the ideal partner for some time now. That is why we are pleased that our intensive talks have now led to this bid by Van Lanschot."

 

Both Van Lanschot and Kempen regularly conducted exploratory talks in the past. In the spring, the two banks initiated constructive talks.

 

An independent top-segment niche bank, Kempen complements Van Lanschot's position in the market. Van Lanschot recently presented its refocused strategy. The concept of the "Full-service Niche Bank" offers clients high-quality services. Van Lanschot primarily targets high net-worth individuals, institutional investors, businesses and entrepreneurs.

 

It is Van Lanschot's ambition to achieve strong growth in the asset management segment. This acquisition is set to more than double assets under management. The new combination's asset management team will be made up of 120 professionals. Traditionally, Van Lanschot has been strong in fixed-interest funds, whilst Kempen manages strong real estate and small and midcap funds (including the Orange Funds).

 

In addition, Kempen holds an excellent position in corporate finance, which services will become available to Van Lanschot clients. This is relevant in particular for larger family businesses and organisations in the healthcare sector.

 

Kempen Securities focuses mainly on securities brokerage for professional investors in Europe and the US; it will join forces with Van Lanschot's brokerage activities. In addition, Kempen clients will be able to benefit from the expertise of the European Securities Network (ESN).

 

The acquisition price is EUR 300 million (of which around EUR 240 million goodwill). Of this amount, approximately EUR 110 million will be paid in shares and approximately EUR 190 million will be paid in cash. To strengthen Van Lanschot's financial position, shares will be issued to the tune of approximately EUR 70 million, in addition to the payment of about EUR 110 million in shares to Kempen's shareholders.

 

As part of the intended transaction, a large group of Kempen employees, who jointly hold nearly 40% of the shares, will convert the majority of their shares in Kempen into shares in Van Lanschot. These shares will be subject to a three-year lock-up. This includes the interest held by Mr Pot, the current chairman of the Management Board. The other Kempen shareholders will receive a cash payment in exchange for the shares that they offer for sale.

 

This transaction requires the collaboration of the Kempen shareholders and is subject to the approval of the competent regulatory authorities. The transaction is expected to be completed in January 2007.

 

After the transaction has been completed, Kempen will continue to enjoy a high degree of independence within the Van Lanschot Group. The Van Lanschot activities in the fields of institutional asset management and institutional brokerage (including research) will be combined with the Kempen activities.

 

It has been proposed to the Supervisory Board that, subject to the approval of the Dutch Central Bank, Mr I.A. (Ieko) Sevinga be appointed to the Board of Managing Directors of Van Lanschot.

 

 

 

 

's-Hertogenbosch, 7 September 2006

 

 

The press release can be downloaded from the following link: