Germany's giant Deutsche Bank AG became the world's largest banking company yesterday, completing its $9 billion acquisition of Bankers Trust Corp. six months after the deal was announced.
The transaction gives Deutsche Bank a stake in Baltimore, the home of BT Alex. Brown Inc., which was acquired by Bankers Trust in September 1997.
No plans exist to relocate Alex. Brown's roughly 1,300 employees in the Baltimore area, said Rolf-E. Breuer, who heads Deutsche Bank as spokesman of the board of managing directors.
"I think Alex. Brown is here to stay," said Breuer, who met yesterday with The Sun's editorial board. "We appreciate what Alex. Brown has done here and the roots it is built on."
Breuer said Alex. Brown will not only retain its nearly 200-year-old name, but also will drop the "BT." The Alex. Brown name has better brand recognition in the United States than Deutsche Bank's name, Breuer said.
And, Breuer noted, if Alex. Brown's business grows, there would be no reason not to add staff.
"I really hope that we have reason to grow it," he said. "We are always ready to invest in staff."
The combination of Deutsche Bank and Bankers Trust creates a financial services juggernaut with $817 billion in assets, more than 95,000 employees -- half of whom will work outside Germany -- 2,375 branches and operations in 68 countries.
Breuer downplayed becoming the head of the world's largest banking company. "I would be proud to be the most profitable bank in the world," he said. "I am not proud of being the largest bank in the world."
Deutsche Bank had been hunting for a U.S. acquisition for months when it found Bankers Trust, which came into the deal after losing a staggering $488 million in the third quarter of 1998 on investments in junk bonds and Russian securities.
The Frankfurt-based banking company paid $93 a share. The purchase was the largest ever of an American financial services company by a foreign company.
Deutsche Bank was attracted to the deal largely because of Alex. Brown, the nation's oldest investment bank that has taken public such companies as Microsoft Corp., Starbucks, Outback Steakhouse, America Online and Oracle Systems. It also boasts a strong private client business, handling money for wealthy individuals.
Deutsche Bank tapped Mayo A. Shattuck III, the former president and chief operating officer of Alex. Brown, and Yves de Balmann, his Bankers Trust counterpart, to jointly run the company's global investment banking business.
"I doubt without Alex. Brown we would have done it," Breuer said.
Breuer said Alex. Brown's expertise in a number of areas, such as raising money for corporations through junk bonds, will be exported to Europe.
Deutsche Bank brings its vast book of European clients and the muscle to push Alex. Brown into other parts of the world.
"Together we go into Asia/Pacific," Breuer said. "Even Asia/Pacific is opened to Alex. Brown. That is why I say Alex. Brown people are enthusiastic about the new world."
Pub Date: 6/05/99