Sunday, September 18, 2011

Patriarch of Europe’s Rothschild Banking Family - Corporate Responsibility - Unifying Holdings - Family Control - Finance Dynasty

Source: Outlook Business

'Auditors haven’t done a good job’
Sir Evelyn de Rothschild, chairman, Concordia BV

01 Dec 2007

His considerable wealth and lifestyle lends an old-world halo to Sir Evelyn de Rothschild, patriarch of Europe’s Rothschild banking family. The Chairman of Concordia BV spoke to Naren Karunakaran on corporate responsibility but was reticent on the Rothschild involvement in the Russian oil giant Rosneft’s controversial $10.7-billion IPO in 2006. Sections of the financial community had railed against it on ethical grounds, for Rosneft’s principal asset, Yuganskneftegaz, was allegedly acquired in a forced auction by the Russian government.

Debates on corporate responsibility are gaining in decibels. Why?

It goes in waves. A change in government may bring about more regulation or less regulation. You see that in the US with Sarbanes Oxley. In the UK, we split responsibilities between the Bank of England and the Financial Services Authority. These moves reinforce corporate responsibility. I think, shareholders have to be well cared for.




Evelyn de Rothschild,
Chairman, Concordia BV


There is an accusation that corporates are obsessed with shareholder value and tend to look away at hard, societal aspects of doing business.

Investor groups, like hedge funds, are moving in. They are only keen on quick returns and aren’t particularly interested in the company per se. Their focus is on capital gains. To me, it is rather difficult to understand. It’s a question of the type of investors a company has.

The key to modern corporate responsibility, therefore, is the appointment of independent directors on the board, those who understand the business and issues, like competence of auditing. I think, the auditors worldwide have failed to do a good job.

How does one rectify the situation?

There are two sides to auditing. One is actually doing the accounting procedures; and the other is to be absolutely upfront and tell the management that the people running the accounts in the company are not doing it satisfactorily. Auditing firms have to engage in staff assessment. However, these firms are so keen to keep the business that they tend to go soft on the company. They have to be tougher.

You see this happening in the short-term?

I don’t know whether it will happen. But it should happen. Three or four companies control the entire audit world. That’s wrong. There is little to choose from. Frankly, the whole standard of ethics is the key criteria to good business. The government also has to put in tougher systems. Basically, we have to train people to behave correctly.

"Today, the key to modern corporate responsibility is the appointment of independent directors on the board"

You’ve had a close association with the global metal and mining industry.

I was director of De Beers and was close to Rio Tinto and others. I am familiar with the issues — environment and resettlement of the displaced. The shareholder has to be protected. A company cannot spend large amounts of money on the environment if it is detrimental to the value of the company.

Did it worry you when controversy hit the Rosneft IPO? ABN Amro-Rothschild was joint bookrunner to the IPO, which investor George Soros and others described as facilitating the sale of stolen goods.

Was there a controversy? I can’t remember, my memory is bad, it was a while ago.

Evelyn de Rothschild, Chairman, Concordia BV










Rothschild banking family to unify holdings

Tue Jul 17, 2007 3:00am EDT

PARIS, July 17 (Reuters) - The Rothschild banking family have struck a 446 million-euro ($615 million) deal to unify the shareholdings of the English and French branches of the family, one of their holding companies said on Tuesday.

The Paris Orleans (PROR.PA) holding company said it would now own 100 percent of Concordia BV, the ultimate holding company of the Rothschild banking group.

Paris Orleans said it would buy a remaining 50 percent stake in Concordia BV for 446 million euros in shares and in cash.

"It enables us to simplify further the shareholding structure of the group and to unify the shareholding of the French and English branches of the family for a new generation," David de Rothschild, who heads up the French part of the Rothschild family, said in a statement.

($1=.7250 Euro) ((Reporting by Sudip Kar-Gupta; editing by Greg Mahlich; Reuters Messaging: sudip.kargupta.reuters.com@reuters.net; tel +33 1 49 49 54 52)) Keywords: ROTHSCHILD HOLDING







Rothschilds' Paris-Orleans to Buy Rest of Concordia


By Jacqueline Simmons - July 17, 2007

July 17 (Bloomberg) -- Paris-Orleans, the publicly traded holding company of the French Rothschilds, will buy the rest of family banking concern Concordia BV, enabling Sir Evelyn de Rothschild to exit with about 200 million euros ($276 million).

Paris-Orleans will pay 446 million euros for the half of Concordia currently held by the U.K. side of the family. Sir Evelyn will sell his Concordia stake of about 18 percent, while his three children will receive shares in Paris-Orleans, according to a U.K.-based spokesman for Rothschild.

''It enables us to simplify further the shareholding structure of the group and to unify the shareholding of the French and English branches of the family for a new generation,'' David de Rothschild, who oversees the family's banking group, said in an e-mailed statement today.

Rothschild, the bank that helped fund Wellington's victory over Napoleon in 1815, united its global businesses five years ago for the first time in its 200-year history. The family also placed David de Rothschild, 64, at the helm of the group after he took management control of the U.K. branch from his English cousin, Sir Evelyn, who is 75.

Paris-Orleans will pay half in cash and issue 647,000 new shares for the remainder of Concordia. After the deal, the French and British Rothschilds will share control of Paris-Orleans, with a combined 51.1 percent of the voting rights.

Sir Evelyn's family, principally his three children, will own 36.5 percent of the company, while David de Rothschild will hold 25.1 percent. Eric de Rothschild, 66, who currently chairs Paris-Orleans's supervisory board, will own 38.4 percent.

Family Control

The French Rothschilds currently hold 37.5 percent of Paris-Orleans, and 45.7 percent of the voting rights. Both the English and French branches own half of Concordia, which was created in 2003 as a holding company for the family's banking assets worldwide.

Before that, Rothschild in France and the U.K. operated separately because the Paris bank was nationalized in 1981 by Socialist President Francois Mitterrand. In 1983, David persuaded the government to give the Rothschilds a new banking license.

The plan announced today, ''will secure the long-term stability of Paris-Orleans and the family's control of the banking activities that bear the Rothschild name,'' the statement said.

The moves won't affect day-to-day management of Paris-Orleans or the various banking entities within the Rothschild group. Banking will account for 70 percent of the value of Paris-Orleans' assets following the transaction, which requires approval from French and U.K. regulatory authorities.

Paris-Orleans shares were suspended in Paris trading today. The stock has risen 47 percent in the past year.

As part of the reorganization, Rothschild Continuation Holdings AG, a company controlled by Concordia, will acquire 32 percent of Paris-based Rothschild & Cie. Banque. The move will bring Rothschild Continuation Holdings' stake in the French bank to 44.3 percent.

Rothschild Continuation Holdings also controls units including London-based N.M. Rothschild & Sons Ltd. and Rothschild North America Inc.

To contact the reporter on this story: Jacqueline Simmons in Paris at jackiem@bloomberg.net

To contact the editors responsible for this story: Frank Connelly fconnelly@bloomberg.net; Adrian Cox acox2@bloomberg.net

Rothschilds' Paris-Orleans to Buy Rest of Concordia (Update2)


Source: Bloomberg

Rothschilds to Unite French, U.K. Banks to Secure Control

By Anne-Sylvaine Chassany - Apr 5, 2012 3:55 AM PT

The Rothschild family plans to merge its French and U.K. banks into one company to tighten control over the assets before an eventual succession of the group’s chief, David de Rothschild.

Rothschild & Cie Banque, the company that holds the French assets of the family such as the eponymous Paris-based mergers and acquisitions bank, and Rothschilds Continuation Holdings AG, which holds assets including London-based bank N.M. Rothschild & Sons Ltd., will be combined under French-traded Paris Orleans et Cie. SA, it said in an e-mailed statement last night. Paris Orleans will change its legal structure to a limited partnership to give the family control over the long term, it said.

David de Rothschild

“This will enable us to address the requirements of a globalized and competitive world while securing control of the family over the group,” David de Rothschild, 69, who oversees the whole firm, said in the statement.

The decision is part of a unification process between the two branches of the family that started when David de Rothschild took managerial control of the U.K. side of the bank after his cousin Evelyn de Rothschild retired in 2004. While David is the first French national to run the English half, the ownership of the investment bank has remained split between the two families. The plan simplifies the ownership of the banking operations worldwide and will help integrate the teams further.

Succession Planning

The new structure will also facilitate the succession plans of David de Rothschild. He will be chairman of PO Gestion, a company fully owned by the Rothschild family and which will control Paris Orleans (PAOR), while Nigel Higgins, chief executive officer of Rothschilds Continuation, and Olivier Pecoux, CEO of Paris Orleans, will become co-heads of PO Gestion. His son Alexandre de Rothschild, 32, joined the family bank in 2009 from Argan Capital, Bank of America Corp.’s former European private-equity division.

“My son at 37 may be qualified to play some role,” David de Rothschild said in a 2005 interview. “It’s subject to him enjoying it and having the qualities.”

He envisages stepping down when he is between 72 and 76, he was quoted as saying in an interview with French newspaper Le Figaro today.

David was born in the U.S. when his parents fled the Nazis during World War II. The family returned to Europe when the war ended, and during the 1960s, Evelyn and his cousin Jacob rebuilt the London bank, N.M. Rothschild & Sons Ltd.

June Approval Sought

In Paris, David’s father, Guy, expanded the bank by opening branch offices and taking deposits. David joined the investment bank as chairman of the management committee in 1978 when he was 36. In 1982, the Paris bank was nationalized by Socialist President Francois Mitterrand. The same year, David opened an asset-management business in France, which he called PO Banque.

Paris Orleans is offering to buy out minority shareholders at 17 euros ($22) per share and will seek approval at a meeting in June, it said. Paris Orleans directly and indirectly owns 45 percent of Rothschild & Cie. and controls about 53 percent of Rothschilds Continuation. RIT Capital Partners Plc, the London-based investment trust led by Jacob Rothschild, and Edmond de Rothschild Group aren’t part of the group led by David de Rothschild.

Paris Orleans shares rose 3.4 percent to 16.86 euros at 12:50 p.m. in Paris, valuing the company at 548.2 million euros.

To contact the reporter on this story: Anne-Sylvaine Chassany in London at achassany@bloomberg.net

To contact the editor responsible for this story: Edward Evans at eevans3@bloomberg.net







Rothschilds to merge British and French banking operations to secure control

The Rothschild dynasty is to merge its British and French banking operations to secure long-term control of the business and to boost the firm's financial strength ahead of the introduction of tougher capital requirements for banks.

The Rothschild's Paris-based bank was formed 200 years ago

By Harry Wilson

5:29PM BST 05 Apr 2012

The 200-year-old banks will be reunited under a single shareholding that will bring together the fortunes of the French and English sides of the renowned family as they attempt to safeguard the business against the effects of new regulation and the fallout from the global financial crisis.

Paris Orleans, the Rothschild Group's Paris-based holding company, will convert into a French limited partnership, securing the families' control of the bank against potential takeovers. The new partnership will then buy out minority investors in NM Rothschild & Sons, the UK business, as well as outstanding minority interests in the French operations.

David de Rothschild will become chairman of the partnership and said the new structure would help the bank "better meet the requirements of globalisation in general and in our competitive environment in particular, while ensuring my family's control over the long term".

Mr de Rothschild is a descendant of Baron James de Rothschild, who established the family's Paris-based bank 200 years ago.

Changing the ownership structure is aimed at helping Rothschild meet the Basel III capital standards that will require banks to maintain a minimum core capital ratio of 7pc. Rothschild said its regulatory capital would be "significantly enhanced" through the merger.

Paris Orleans has a market value of more than €500m (£415m) and is about 30pc owned by outside investors. Rothschild is offering €17 per share to minority investors, a small premium to the company's current market price.

The Rothschild Group employs 3,000 people in 42 countries and is one of the world's leading independent investment banks, advising some of the largest international companies on capital raisings and mergers and acquisitions.

In addition to investment banking, Rothschild also provides asset management services as well as wealth management advice. The bank also remains a player in the private equity industry and operates several merchant banking operations that invest directly in business across Europe and the rest of the world.

In a break from tradition, two years ago Rothschild appointed Nigel Higgins as its chief executive, marking the first time a non-family member had been given the top job at the bank.

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Rothschilds to merge British and French banking operations to secure control



Frankfurt am Main, Germany: largest financial centre in continental Europe; seat of the European Central Bank; birthplace of the German-Jewish Rothschild banking and finance dynasty

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