| Credit Suisse First Boston recently announced that it will buy U.S. investment bank Donaldson, Lufkin & Jenrette Inc. (DLJ) for $90 share, or roughly $11.5 billion. The purchase would provide Credit Suisse First Boston with a strong foothold in the junk bond and merchant banking markets. It would also help the company compete more effectively against its investment bank rivals Goldman Sachs Group and Morgan Stanley Dean Witter.
DLJ, the seventh-largest investment bank in the nation, is 70 percent owned by the Paris, France-based insurance and financial firm AXA. Credit Suisse First Boston is a division of Credit Suisse Group of Switzerland. The deal is thought to be set up so that public shareholders will receive cash for their shares, and AXA will receive both cash and stock.
Credit Suisse First Boston Chairman and CEO Allen Wheat will become president and chief executive officer of the new firm.
The move follows the recent acquisition of Paine Webber Group by the Swiss banking company UBS, leaving just a handful of independent investment banks in the United States, among them J.P. Morgan, Bear Stearns, and Lehman Brothers. |
