Finland's Evli acquires Suprema Securities

  • 2002-10-31
  • Aleksei Gunter
TALLINN

Evli Bank, a Finnish investment services corporation, acquired Suprema Securities, the largest investment bank in the Baltics, at an undisclosed price two weeks ago.

For Suprema's owners, five of whom collectively own 75 percent of the bank's shares, the sale met their strategic vision. "We had a choice whether to be major shareholders in a small company or minor shareholders in a big one, and we've chosen the latter option," said Peeter Saks, CEO and partner of Suprema.

Suprema Securities grew out of Talinvest, an investment bank, in 1997, with a management buyout taking place two years later. Suprema is the largest equities broker in the Baltics, as well as manager of the largest Baltic pension fund worth 12 million euros, which includes obligatory pension contributions of Lattelekom and Latvenergo, major Latvian phone and energy operators.

Approximately 70 percent of Suprema's business comes from corporate finance projects.

Among Suprema's major projects were initial public offerings of Estonian Telecom and the Latvian Shipping Company, as well as consulting work on the Mazeiku Nafta – Yukos deal.

"We've reached our limit in the Baltics. Evli is the next level," said Henrik Igasta, head of investment banking and partner at Suprema, adding that the company had a number of other merger options in the last several years.

According to the daily Aripaev, Suprema's top five shareholders, all of whom work in top management, could receive over ten million kroons (639,000 euros) each for their shares. In addition, they will receive 1.2 percent of Evli shares collectively.

For Evli, the acquisition creates a perfect synergy. According to Henrik Andersin, CEO of Evli, the corporate finance market in the Baltics will likely grow 25 percent to 30 percent annually over the next several years.

"The asset management market is growing. The Baltics will hopefully join the EU in 2004, and that in general stimulates the desire of Nordic companies to expand into the Baltics," Andersin explained.

It was Evli's second major acquisition this year, after its takeover in April of Arthur Andersen's corporate finance units in Sweden, Denmark, and Finland.

Andersin added that Evli is now the only Scandinavian investment bank represented locally in the Nordic countries and in the Baltics.

Evli will assimilate the 46 Suprema employees in Estonia, Latvia and Lithuania. The Suprema trademark will vanish in approximately two years after the merger is completed.

Suprema's competitors assessed the merger as a positive development for Estonian and Finnish businesses in general. Joakim Helenius, chairman of Trigon Capital investment services company, said the deal shows that Finnish investors trust the Estonian market.