UBS Group has agreed to purchase the ailing European bank Credit Suisse for $3 billion, according to various reports on March 19.
UBS will buy Credit Suisse
Swiss President Alain Berset announced the deal in the evening, according to reports from the Associated Press. The government brokered the deal to prevent a financial crisis.
The value of the deal increased over the day. UBS Group initially offered to buy Credit Suisse for just $1 billion. UBS Group then raised its bid, and although Berset did not initially reveal the size of the deal, many reports placed the deal’s value at $2 billion.
As of 8:00 p.m. UTC, the Associated Press suggests that the deal is worth $3.2 billion. The current report also suggests that the Swiss National Bank will provide $162 billion of liquidity to UBS Group, up from $54 billion as previously announced.
Credit Suisse experienced specific issues leading up to the sale. Though the company has faced scandals for years, new issues arose on March 14, as managers disclosed “material weaknesses” in the bank’s financial reporting controls.
Concerns around Credit Suisse caused its share value to fall rapidly: company stock (CHF) is now valued at $1.86, representing a decline of 32.85% over the past month.
Justin Sun made crypto proposal
Justin Sun, known for his leadership role at Huobi and his former involvement with TRON, offered to buy Credit Suisse for $1.5 billion earlier in the day.
Sun wrote in a series of tweets on March 19:
I would like to propose my own offer of $1.5 billion to acquire Credit Suisse and integrate it into the Web3.0 world. Switzerland has been one of the most crypto-friendly countries in the world.
Sun wrote that UBS’s original bid “falls short” and described his own plans to integrate Credit Suisse with blockchain technology and cryptocurrency. He noted that Switzerland is among the world’s most crypto-friendly countries in terms of regulation.
It is unclear whether Credit Suisse and the Swiss government considered Sun’s offer.
Fortune suggests that the country considered nationalization the only possible alternative to the UBS deal, which implies that Sun’s offer was not seriously considered.
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