Credit Suisse Buys DLJ for $11.5B

Z U R I C H, Switzerland, Aug. 30 -- Credit Suisse Group AG is buying thebrokerage Donaldson, Lufkin & Jenrette for $11.5 billion,marking the second time this summer a Swiss banking giant will takecontrol of a Wall Street firm.

The deal, announced today, would unite DLJ with CreditSuisse’s investment banking firm Credit Suisse First Boston, whichhas headquarters in London and New York.

If successful, the deal would create one of the leadingunderwriters in high yield, or junk, bonds as well as one of thetop firms offering merger advice to corporations. At the same time,it would expand the global reach of DLJ.

The combined company will have more than 26,500 employees andassets in excess of $600 billion.

The announcement followed July’s move by Credit Suisse rival UBSAG to buy New York-based brokerage firm PaineWebber in a deal worthabout $11 billion. Credit Suisse is Switzerland’s second-largestbanking group, following UBS.

Pricing the DealCredit Suisse said it will pay $90 per share in cash and stockfor New York-based DLJ. The DLJ and Credit Suisse boards have votedto approve the offer, Credit Suisse said.

“This powerful combination substantially strengthens CreditSuisse First Boston’s competitive position as one of the world’sleading investment banking services,” according to the Swiss bank.

A stake of some 71 percent in DLJ is held by Axa Financial, asubsidiary of French insurance giant Axa SA. Axa has agreed to sellits holding in DLJ for $8.1 billion, Credit Suisse said in astatement.

In early September, Credit Suisse will open a cash tender offerin the United States for the 29 percent of shares held by DLJ’spublic shareholders, it added.

Axa will receive 30 percent of its payment in cash and 70percent in Credit Suisse Group shares.

DLJ would make an “important contribution” to Credit SuisseGroup’s asset management and private banking business in the UnitedStates, the statement said.