Deutsche Bank — in a broadening effort to keep the lights on in its US operations — has agreed to work with NY-based private equity firm Cerberus Capital Management to explore options as a paid advisor.
Cerberus President Matt Zames — once considered by Deutsche to be on short list to replace ex-CEO Jon Cryon and is formerly a C-Suite executive from JPMorgan — is leading the project.
Cerberus holds roughly a 3% stake in Deutsche and a 5% stake in rival German bank Commerzbank. Talk was earlier this year that the two firms should form an alliance since their core businesses have differing strengths. DB on the corporate side and Commerzbank on the retail side in Germany.
New CEO Christian Sewing is struggling to find a palatable solution to the free fall stock price while not retreating from the US.
While neither party is talking merger at this time, Cerberus could push the boards together since PE firms usually have a shorter investment timeline to turn a profit. Shares of Deutsche are off 40% over the last 12 months and is trading at $11.54 here in the US.