DNB Bank ASA

M&A Activity • Oct 21, 2024

Correction: DNB Bank ASA acquires Carnegie - Accelerates Nordic strategy and growth in fee-based income

Correction: DNB Bank ASA acquires Carnegie - Accelerates Nordic strategy and growth in fee-based income

Oslo, October 21. 2024 - DNB Bank ASA ("DNB") has entered into an agreement to

acquire all the shares of Carnegie Holding AB, from Altor and the minority

shareholders for a total consideration of approximately SEK 12 billion (the

"Transaction"). The Transaction is subject to approvals from authorities in

applicable jurisdictions and is expected to close in the first half of 2025.

Carnegie Holding AB is the parent company of the Carnegie Group ("Carnegie") - a

leading investment bank and asset manager in the Nordics with 850 employees,

deriving 56 per cent of its revenue from investment services and 44 per cent

from wealth management.

- Through the acquisition of Carnegie, our goal is to provide even better

solutions to our clients. We and Carnegie are realizing our joint ambition to

build a leading player across the Nordic region in investment banking,

securities brokerage and research, corporate banking, private banking and asset

management. Carnegie is a perfect fit, in-line with our strategy, and the

Transaction marks a step change in increasing the share of fee related income

for DNB as a whole, Kjerstin Braathen, CEO of DNB, says.

To reflect the strategic importance of the Transaction, DNB Markets will be

globally renamed DNB Carnegie, with both companies' strong reputations and

cultures continuing under the unified brand.

Tony Elofsson, CEO of Carnegie, comments:

-DNB is a perfect partner for us to continue the legacy of Carnegie as part of a

larger financial services group. By merging Carnegie and DNB Markets into DNB

Carnegie we significantly enhance our ability to serve our clients across the

Nordics, expanding the product offering while retaining our entrepreneurial

spirit and client-centric focus.

DNB Carnegies's investment services and private banking operations in Sweden,

Denmark and Finland will primarily be managed from Carnegie Investment Bank AB,

which will be renamed DNB Carnegie Investment Banking AB and continue under

Elofsson's leadership.

- The Carnegie team is highly committed in continuing our successful journey

across the Nordics together with our new colleagues from DNB Markets. Through

the extensive preparations leading to the Transaction, and previous joint

transactions, we have learnt that the cultural fit is strong, and our

complementarities will be of great benefit to our clients and employees,

Elofsson continues.

Bridging the Nordics and International Markets

DNB Carnegie aims to form a strengthened position within investment banking,

securities brokerage and research across all products and key sectors in the

Nordic region, further enhancing the offerings to clients in the Nordics and

internationally.

- The Transaction will enhance our scale, resources, and deep sector knowledge,

and our global network and offering will enable us to achieve successful

outcomes for our clients. We look forward to welcoming Carnegie, Alexander

Opstad, Head of DNB Markets, comments.

The businesses are highly complementary both in terms of geography and products,

and the

presence in Norway, Sweden, Finland and Denmark, combined with offices in

London, New York and Singapore, will enable us to better connect the Nordic and

international markets.

-DNB Carnegie will have the capabilities of a large international investment

bank with the agility from strong local expertise, local market knowledge and

local networks, Opstad says.

Strengthening the offering in wealth management

DNB Wealth Management has a strong position in Norway within asset management,

private banking, pensions and savings. Carnegies brand and long track record in

this segment, particularly in Sweden and other Nordic markets, will give the

combined business new opportunities across the Nordic markets.

-With this transaction we strengthen our pan Nordic wealth management offering

and achieve further scale in our operations. Our products, services and

distribution channels, which are already among the best in the market, will

improve even further through the Transaction, which will benefit our customers.

Jointly we will be even better equipped to meet and exceed the expectations of

our new and existing customers, Håkon Hansen, Head of DNB Wealth Management,

says.

Purchase price and timeline

The purchase price is expected to be approximately SEK 12 billion, payable as

cash consideration, subject to certain adjustments and assuming a normalized

CET1 level in Carnegie at closing. Any excess capital will be normalized or

adjusted for in the final purchase price.

The Transaction is expected to close in the first half of 2025, and closing

conditions include regulatory approvals from authorities in applicable

jurisdictions. Until regulatory approvals are obtained and closing of the

Transaction occurs, the businesses will continue to operate independently.

Key financials and impact on DNB financials

As of 30 September 2024, Carnegie had SEK 436 billion in assets under management

in private banking and asset management. For the nine months ended 30 September

2024, Carnegie reported a net income of SEK 535 million and a return on equity

of 18 per cent.

Looking ahead, Carnegie is expected to benefit from continued recovery in

transaction and market activity, full year consolidation of recently closed

wealth management acquisitions, and efficiency gains from completed platform

investments and restructuring measures which created non-recurring costs during

the reported period. Carnegie's net income contribution to DNB before synergies

and other transaction benefits is expected to be in excess of SEK 1 billion from

2025 onwards, implying an earnings multiple of approximately 12x on the purchase

price before synergies.

The Transaction is expected to be accretive to DNB Group and generate a return

on invested capital in excess of 15 per cent on a fully integrated basis. The

primary value driver of the Transaction is the growth opportunities unlocked by

a stronger combined Nordic platform and enhanced client offering which are

expected to generate the majority of transaction benefits. The Transaction will

lead to some efficiency gains across our combined operations.

At the end of Q2 2024, DNB's CET 1 ratio was 19.0 per cent, while the regulatory

requirement was 15.6 per cent and the FSA's expectation (including Pillar 2

Guidance) was 16.9 per cent. The Transaction is expected to reduce DNB's CET 1

ratio with approximately 120 bps and will not negatively impact he distribution

policy.

Advisers

DNB Markets and Morgan Stanley & Co. International plc acted as financial

advisors and Mannheimer Swartling acted as legal advisor to DNB.

Investor call

Investors and analysts are hereby invited to participate in an investor call

about the transaction on October 21., 11.15-12 CEST. The investor call will

include a Q&A session and will be held in English.

Call in details:

Norway +47 21 56 33 18

UK-wide +44 (0) 33 0551 0200

US +1 786 697 3501

Password: DNB.

Please join the call early to allow the operator to transfer you into the call

by the scheduled start time."

Contact: Rune Helland, Head of Investor Relations, telephone +47 97 71 32 50

Press

The press is invited for interviews, in Oslo/Stockholm and digitally.

DNB CEO Kjerstin Braathen and CFO Ida Lerner, and Head of Carnegie Norway,

Christian Begby, will be available for interviews at DNB Head office in Oslo.

Tony Elofsson, CEO of Carnegie, Alexander Opstad, Head of DNB Markets, and Håkon

Hansen, Head of DNB Wealth Management, will be available for interviews at

Carnegie Head Office in Stockholm.

Both press meetings at 10.00 CEST.

Contact Øystein Kløvstad Langberg, Head of Communications DNB, for interviews in

Oslo

+47 980 48 825, or

Emelie Friberg, Head of Communication Carnegie, for interviews in Stockholm

+ 46 734 17 92 29

Adresses:

DNB: Dronning Eufemias gate 30, Oslo

Carnegie: Regeringsgatan 56, Stockholm

This stock exchange notice contains inside information which is subject to the

disclosure requirements in article 17 of the Market Abuse Regulation.