Exotic becomes ever more attractive

Thu Feb 1, 2007



Amid the recent flurry of M&A activity, one transaction that attracted relatively little attention was the move by Credit Suisse to acquire a majority stake in Hedging-Griffo, a Brazilian group based in São Paulo. In the deal announced just before Christmas, the Swiss-based banking giant paid $294 million in cash for a stake of just over 50% in Hedging-Griffo, which runs about $8 billion in a range of hedge funds, equity funds and funds of funds.

According to the announcement, the deal was at approximately 9.5 times current-year earnings - not a bad multiple. The valuation was probably enhanced by Hedging-Griffo's brokerage and private banking business, serving the high-net-worth market in Brazil. Nevertheless, it will not have escaped Credit Suisse that the group, headed by Luis Stuhlberger, also runs some hedge funds...

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