Goodbody Stockbrokers is set to be sold to Bank of China in a deal understood to be worth around €150m, after a lengthy sales process.
It is also understood key management and staff at Goodbody will be further incentivised if certain performance targets are met over the first three years under the new ownership.
Goodbody is Ireland’s oldest stockbroking firm. It is currently 49% owned by its management team and 51% owned by Co Kerry-based financial services group Fexco.
The deal, which requires regulatory clearance, will see Bank of China UK take 100% ownership of Goodbody. Bank of China UK is a wholly-owned subsidiary of Bank of China, one of the four largest State-owned commercial banks in China.
The takeover of Goodbody requires approval from Ireland’s competition regulator the Competition and Consumer Protection Commission, the Central Bank and the Chinese competition regulator. It is expected that the acquisition will be completed during the second quarter of next year.
Goodbody is active in wealth management, investment-fund management, investment banking and asset management. The Competition and Consumer Protection Commission has set a deadline of December 3 for submissions on the proposed takeover.
The Goodbody sales process has been ongoing for some time. A potential sale to Chinese suitors (a consortium led by Zhongze Culture Investments) fell through in January, when Goodbody pulled the plug on the deal.
Since then, Goodbody’s chief rival Davy was reported to be an interested buyer, as was Irish Life. It is understood, however, that Goodbody’s management never met Davy and never viewed that transaction as realistic. However, Irish Life was viewed as a serious contender.
Consolidation has contracted the Irish stock- broking market in recent years. Davy acquired the private wealth business of Bloxham Stockbrokers when it was liquidated in 2012. Cantor Fitzgerald completed its takeover of Merrion late last year.
Goodbody’s majority shareholder Fexco last month reported an 11% income rise for 2018 to €236m.