Shortlist for RBS Sempra bid 'down to three'

Published on Monday 21 December 2009 21:24

DEUTSCHE Bank, JPMorgan Chase and Australia's Macquarie are the remaining runners in the race to buy RBS Sempra, the joint venture commodities trading business that is up for sale, sources said last night.

A deal likely to be worth about 2 billion or more, if agreed, is likely to be struck early next year, the source said, adding that initial interest from about 20 firms has been whittled down.

RBS Sempra, which trades commodities from oil and natural gas to metals and agricultural products, would offer entry into a lucrative market with a diverse global trading book, or a chance for a bank to significantly bulk up in commodities.

Deutsche Bank is in talks to buy RBS Sempra as part of plans to strengthen its commodities business, several sources have said.

It faces competition from JP Morgan, the US bank that has picked up assets after weathering the financial crisis better than most rivals, and Australian group Macquarie, which operates in 28 countries and is already active in commodities.

Royal Bank of Scotland, Deutsche Bank, JPMorgan and Macquarie all declined to comment. Lazard, which is advising on the sale, also declined comment.

RBS chief executive Stephen Hester is being forced to sell the bank's 51 per cent interest in RBS Sempra by the European Union's competition authorities due to the bailouts it has been given by the UK government.

The bank's partner, Sempra Energy, is also considering selling its stake, sources said. RBS paid 1.1bn for its stake in 2008, while Sempra Energy invested 1bn.

RBS has four years to sell its stake, but is attempting to offload it more quickly than other assets such as its insurance arm or retail branches, as the business would lose value if staff leave or uncertainty about the unit persisted. Deutsche said last week it wanted to expand in commodities.

Macquarie has more than 12,700 staff and has been active in Europe since the late 1980s. Its fixed income, currencies and commodities arm provides services to financial institutions and significant commodity producers and consumers and operates in most major trading markets and emerging markets around the world, according to its website.