DAB is in talks about buying online financial services providers First-e and Fimatex.
The news that DAB, Europe’s third largest online broker, is in takeover talks with Fimatex, Societe Generale’s loss making online brokerage comes as little surprise given the current state of Europe’s online broking market. Following the footsteps of Comdirect and Consors, DAB has posted declining transaction volumes as the markets have turned and investors’ wallets have tightened. DAB has had more luck in growing its customer base and, having acquired the French brokerage Selftrade last year, has already stolen a march on its closest rivals by emerging as the only broker with a reasonably strong brand across major European markets.
Talks with First-e are slightly more surprising, it being an online bank rather than a brokerage. Once again, it’s most likely that DAB is after First-e’s customer base, which could be bought at a set fee per customer. This move is an indication of the battles that are shaping up as Europe’s big online brokers are on the look out for new customers as their existing customers’ reduce their trading volumes.
A takeover of Fimatex would give DAB access to one of the strongest technological platforms in the online stockbroking market. In particular, Fimatex has been at the forefront of adding new channels, including Palm, WAP, voice recognition and iTV. With brokers all suffering the malaise of falling transaction volumes and ever-rising marketing and technology costs, consolidation offers the best prospect of quickly growing market share and attaining cost synergies. DAB has thrown its cards on the table – now don’t expect Consors and especially Comdirect to stay quiet for long.
