By Valentina Za
MILAN (Reuters) – Mediobanca said on Thursday it had agreed to buy London-based Arma Partners, as Italy’s leading investment bank seeks to capture growing corporate demand for advisory services on tech deals and expand its international reach.
The acquisition, which Mediobanca expects to boost its fee income by 10%, comes ahead of a new three-year strategy CEO Alberto Nagel will unveil on May 24.
With a focus on software, cloud services, data and fintech, Arma has advised on some 100 transactions over the past five years worth in aggregate more than $85 billion. It ranks first as an adviser on large European software buyouts.
In 2020, it worked with U.S. private equity firm Hg as it further invested in Visma, a Norwegian software provider which was valued at $12.2 billion in the world’s largest ever software buyout.
In the same year, it advised Germany’s Aareal Bank on the sale of a stake in its $1.1 billion software unit Aareon to Advent International.
In 2021, it was sole financial adviser to British digital wealth manager Nutmeg on its $839 million sale to JPMorgan.
Mediobanca did not disclose the price of the transaction, saying only it would pay 40% in cash at closing and stagger the rest over four years based partly on Arma’s performance.
The remainder can be paid in Mediobanca shares, in which case the transaction’s full price would take around 30 basis points off the bank’s core capital ratio.
The deal will boost earnings per share, based on last year’s figures, Mediobanca said, without elaborating.
“This transaction … will have a material impact on the Corporate Investment Banking fees pool, increasing by approximately 30%,” it said.
The acquisition, which needs clearing from European, UK and U.S. regulators, is expected to close in the autumn.
With 86 staff and some $100 million in yearly revenue, Arma was founded in 2003 by Paul-Noël Guély, a former head of software and services investment banking at Goldman Sachs.
Arma has offices also in Munich, a U.S. presence and a network of affiliated advisory firms in Japan, Australia, Israel, Turkey and Brazil.
To grow its international footprint, Mediobanca in 2019 acquired French M&A boutique Messiér et Associes and last year hired former Santander and Lloyds top executive António Horta-Osório as senior adviser.
(Additional reporting by Pablo Mayo Cerquiero in London; Editing by Keith Weir and Mark Potter)