DNB Bank ASA Acquires Carnegie Holding AB

DNB Bank ASA (OL:DNB) (OTC:DNBBY), Norway's largest bank, announced it will acquire Carnegie Holding AB, a prominent Nordic investment bank and asset manager, for SEK 12 billion ($1.14 billion).

The transaction, which is subject to regulatory approval and expected to close in the first half of 2025, aims to enhance DNB's presence in the Nordic region.

Carnegie generates 56% of its revenue from investment services and 44% from wealth management. This acquisition will merge Carnegie and DNB Markets into a new entity called DNB Carnegie, thereby significantly improving their client service capabilities across the Nordics.

Tony Elofsson, CEO of Carnegie, stated, "By merging Carnegie and DNB Markets into DNB Carnegie we significantly enhance our ability to serve our clients across the Nordics."

The combined entity aims to strengthen DNB’s position in investment banking, securities brokerage, and wealth management. DNB’s CEO, Kjerstin Braathen, emphasized that this acquisition aligns with DNB’s strategy to enhance services and accelerate its shift toward fee-related income.

This deal will boost DNB’s wealth management operations by leveraging Carnegie's established presence in Sweden and beyond. Financially, DNB anticipates this acquisition will contribute more than SEK 1 billion to its earnings starting in 2025, before considering synergies, with a projected return on invested capital of over 15% once fully integrated.

While the acquisition will reduce DNB's Common Equity Tier 1 ratio by about 120 basis points, it will still remain well above regulatory requirements. As of September 2024, Carnegie managed SEK 436 billion in assets and reported a net income of SEK 535 million for the first nine months of the year.

DNB was advised by DNB Markets and Morgan Stanley, with Mannheimer Swartling acting as legal counsel.