The Swiss group RBR Capital Advisors is making global headlines with a bid to break up multinational financial services conglomerate Credit Suisse, which RBR says has been on a persistent downtrend for almost a decade — and where CEO Tidjane Thiam has made slow progress with a turnaround bid that sees Credit Suisse’s share price at barely half what it was when he took the reins in 2015. RBR has a plan they believe can turn things around.
The plan, which RBR has dubbed Parade 2.0, essentially involves spinning three distinct entities off Credit Suisse that are more focused in what they do, and ultimately, more profitable: Its investment banking arm, a reborn First Boston, would become leading investment bank based out of London or New York and focused mainly on profitable niches; SKA 2.0, which would provide global wealth management and business banking services; and Suisse Asset Management, which has potential to grow and compete with other international fund and wealth managers. (The outfit’s transaction-specific website breaks it all down here.)
As activist investors with no more than a 0.2% stake in the bank, it’s hard work convincing stakeholders that the plan warrants breaking up a storied member of the bulge bracket, but RBR says it is confident and is raising capital for the play out of the Middle East, the US, and Europe.
The Middle East angle may be critical: The Financial Times reports this morning that Bohli met with top Credit Suisse leaders and may have “toned down its demands for a break-up of the bank,” pushing for a more aggressive cost-cutting program,” possibly funded by a sovereign wealth fund waiting in the wings.
We recently had a chat with RBR Advisors founder and CEO Rudolf Bohli, who will be in Cairo between in early 2018 for an investor roadshow, to understand more about how they think their plan can generate 100% upside for Credit Suisse shareholders. Tap or click here to read the full interview.