UBS: takeover of Credit Suisse to close as early as June 12 (updated)

Credit Suisse AG

05/06/2023 05:54

(Adds detail, background)
    By John Revill
       ZURICH, June 5 (Reuters) - UBS  UBSG.S  said on Monday
it will complete its takeover of Credit Suisse  CSGN.S  "as
early as June 12",  creating a giant Swiss bank with a balance
sheet of $1.6 trillion following a government-backed rescue
earlier this year.
    Completion is subject to the registration statement, which
covers shares to be delivered, being declared effective by the
US Securities and Exchange Commission, and to satisfaction, or
waiver by UBS, of other remaining closing conditions, it added.
    "UBS expects to complete the acquisition of Credit Suisse as
early as 12 June 2023. At that time, Credit Suisse Group AG will
be merged into UBS Group AG," UBS said in a statement.
    Switzerland's no. 1 bank agreed on March 19 to pay 3 billion
Swiss francs ($3.37 billion)and assume up to 5 billion francs in
losses for its smaller Swiss rival after a collapse in customer
confidence brought it to the brink of collapse, prompting the
Swiss authorities to act to stave off a broader banking crisis. 
    Upon completion, Credit Suisse shares and American
Depositary Shares (ADS) will be delisted from the SIX Swiss
Exchange (SIX) and the New York Stock Exchange (NYSE), UBS
added.
    Under the all-share takeover, Credit Suisse shareholders
will receive one UBS share for every 22.48 shares they held.
     Once the deal formally closes, the combined group will
oversee $5 trillion of assets, giving UBS overnight a leading
position in key markets it would otherwise need years to grow in
size and reach. UBS has said the combined bank will be the will
"undisputed leader in Switzerland."
    The mega-bank will employ 120,000 worldwide, although it has
already announced it will in the future be cutting jobs to take
advantage of synergies and reduce costs.
    UBS had been rushing to close the transaction in record
time, hoping to provide greater certainty for Credit Suisse
clients and employees, and to stave off departures.
    The deal was backed by 200 billion francs in liquidity
support from the Swiss central bank as well as the government's
commitment to swallow up to 9 billion francs in losses on top of
those borne by UBS.
   Its management has sought to assure shareholders and the
Swiss public that the "Herculean task" of absorbing its rival
will pay off and will not become a burden for the taxpayer.
    For Credit Suisse, which has struggled to regain customer
confidence after years of missteps and scandals, turmoil
unleashed by the collapse of two mid-sized U.S. lenders in March
proved the final straw.
    As its share price collapsed, cash withdrawals accelerated
and a $54 billion central bank liquidity lifeline offered the
167-year-old lender only a temporary relief, Swiss authorities
stepped in and arranged the deal with UBS over one mid-March
weekend.


($1 = 0.8889 Swiss francs)

 (Reporting by John Revill
Editing by Tomasz Janowski)
 ((John.Revill@thomsonreuters.com; +41 41 528 36 37; Reuters
Messaging: john.revill.thomsonreuters.com@reuters.net))