Framlington has been given assurances that it will retain total independence even though its parent ...
Framlington has been given assurances that it will retain total independence even though its parent company is being bought by HSBC.
Last weekend French bank CCF, which owns 51% of Framlington, accepted a E11.3bn deal from HSBC Holdings. US mutual funds group Munder has a 49% stake in Framlington.
Craig Walton, group marketing director at Framlington, said that the independence it operated under would not be altered.
He added: "All the parties, HSBC, CCF, Framlington and Munder Capital Management have agreed that Framlington will remain totally independent. We are specialist growth managers and we thrive on our autonomy and independence and that has been recognised by all parties to the deal.
"The deal is really HSBC bank and CCF bank, and at the end of the day if Framlington retains its independence all it means for us is a change in the name of our shareholders."
HSBC group spokesman Adrian Russell said that a timetable for the merger had not yet been finalised, but added: "It is envisioned that, subject to the necessary approvals, the acquisition of CCF will be completed during the second half of 2000."
He would not comment on the continued independence of Framlington.
The deal terms have been criticised in a report by Salomon Smith Barney which said the deal looked expensive, even though it makes strategic sense for HSBC by adding to the group's wealth management exposure and deepening its position in eurozone capital and corporate banking markets.
The report suggested that the deal marks new valuation territory for HSBC, offering a starting return on investment of around 4% rising to 7% after savings for merger synergy, at a price of 3.6 times book and 25 times historical earnings. That is a significant increase on the 2.7 times book paid for RNYC/Safra in May 1999.
The deal will be partly financed by a mixture of the planned issue of E1.5bn to E3bn euros of ordinary shares.
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