Watchdog to investigate €150m bid for Goodbody by Chinese bank

Goodbody chief Roy Barrett

THE planned €150m (£128m) acquisition of Dublin-based Goodbody Stockbrokers by Bank of China has been referred to the competition watchdog.

The Republic’s Competition and Consumer Protection Commission (CCPC) said the proposed takeover of Ganmac Holdings, which owns the Goodbody group, had been referred to it by a UK-based unit of Bank of China. The UK arm also has a Dublin branch.

The CCPC has opened a preliminary investigation into the planned acquisition, with third parties able to submit observations on the proposed deal up to December 3.

A full investigation will only proceed if the CCPC is “unable to conclude that the proposed transaction will not lead to a substantial lessening of competition in any market for goods or services in the state”.

The on-off sale of Goodbody Stockbrokers, which is majority-owned by Kerry-based financial services group Fexco, has been in train for nearly a year.

An earlier sale was abandoned in January after moves by the then would-be buyers, China’s Zhong Ze Culture Investments, to alter its proposed shareholder structure. Fexco and Goodbody management, led by Roy Barrett, opted to walk away. Goodbody staff own 49% of the firm.

Bank of China, meanwhile, saw off competition from Goodbody rival Davy Stockbrokers as well as Irish Life to seal an agreement to buy the Irish broker. Irish Life is owned by Canada’s Great Life Westco.

Fexco initially bought a 75% stake in Goodbody for €24m (£20.5m) from AIB in the wake of the financial crash, when the bank rushed to offload assets.

Goodbody’s management and staff later acquired around a quarter of the business to raise their combined holding to the current 49%.

Last year Fexco recouped €23m (£19.7m) from Goodbody by way of a dividend from the stockbroker’s proceeds of the sale of the Irish Stock Exchange to Euronext.