Italian banking group UniCredit has entered into a partnership with Paris-based broker Kepler Capital Markets to create a western European equities unit.
The two firms have agreed a strategic alliance to provide cash equity research and execution services for western European stocks. This includes distribution of Kepler’s equity research and analyst reports for various UniCredit divisions.
UniCredit said it selected Kepler due to the strength of its research product and distribution platform. Kepler currently has 50 analysts covering 460 stocks and will add a further 48 stocks to its coverage as part of the deal, which the firm says will give it the most extensive research footprint in continental Europe, excluding Scandinavia.
“We have decided to create a strategic alliance for Western European equities with Kepler because of Kepler’s outstanding reputation for the quality of its equity research and distribution,” said Jean-Pierre Mustier, head of corporate and investment banking at UniCredit. “There are important similarities between our two companies: both UniCredit and Kepler share a multi-local strategy and both firms share a strong European heritage.”
“We see this strategic alliance as an opportunity to broaden our research footprint and to develop our new issues distribution in conjunction with UniCredit,” added Kepler CEO Laurent Quirin.
The announcement follows the announcement of a strategic realignment for UniCredit as it seeks to strengthen its balance sheet and reduce risk in an uncertain macroeconomic environment. The plan targets a return on equity of around 12% in 2015 and includes a 6,500 – or 12% – headcount reduction in the firm’s commercial banking business in Italy.
“Our new strategic alliance with Kepler in Western Europe is a key step in the ongoing process of concentrating on our competitive strengths and reallocating resources to core client franchises,” added Mustier.