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UBS agrees to sell majority stake in UBS Fondcenter to Clearstream

Sergio P. Ermotti, CEO UBS Group AG

UBS has entered into an agreement to sell 51.2% of its stake in UBS Fondcenter, a part of its Asset Management business division to Deutsche Boerse Group’s post-trade service provider, Clearstream. The agreement will facilitate the combination of Fondcenter with Clearstream’s Fund Desk business with a presence in Europe and Asia.

The new business is expected to be named Fondcenter and will comprise $230 bn in Assets under Administration and will connect around 340 distribution partners. UBS and Clearstream will also enter into long-term commercial cooperation agreements 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.

Sergio P. Ermotti, CEO UBS Group AG, said, “We are delighted to reach this agreement with Clearstream, building on the successful relationship we have had with them and Deutsche Börse Group for many years. Through this transaction and our long-term cooperation arrangements, we can achieve greater scale and breadth of offering for our clients and create significant value for our shareholders.”

The agreement states that UBS will retain a minority stake in its business and will sell the remaining shareholding to Clearstream at a later time.

Commenting on the transaction, UBS AM President, Suni Harford, said, “With the increased breadth of capabilities and Clearstream’s long-term commitment to develop the combined business, we are creating a highly compelling proposition for our clients.” She added: “At the same time, this move enables us to further focus the Asset Management business on the execution of our strategic priorities to drive further profitable growth.”

The press release states that upon closing in the second half of 2020, UBS is expected to recognise a post-tax gain of approximately $600 million and CET1 capital increase of roughly $400 million.

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