Rothschild & Co is the result of a merger between the French and British houses of Rothschild, each with individual but intertwined histories.
British history (N M Rothschild & Sons) Late 18th century In the late 18th century and early 19th century,
Mayer Amschel Rothschild (1744–1812) rose to become one of Europe's most powerful bankers in the
Landgraviate of Hesse-Kassel in the
Holy Roman Empire. In pursuit of expansion, he appointed his sons to start banking operations in the various capitals of Europe, including sending his third son,
Nathan Mayer Rothschild (1777–1836), to
England.
Early 19th century Nathan Mayer Rothschild first settled in
Manchester, where he established a business in finance and textile trading. He later moved to
London, founding N M Rothschild & Sons in 1811 at
New Court, which remains the location of Rothschild & Co's London headquarters today. Through this company, Nathan Mayer Rothschild made a fortune with his involvement in the
bond market. According to historian
Niall Ferguson in 1999, "For most of the nineteenth century, N. M. Rothschild was part of the biggest bank in the world which dominated the international bond market. For a contemporary equivalent, one has to imagine a merger between
Merrill Lynch,
Morgan Stanley,
JPMorgan Chase & Co. and probably
Goldman Sachs too—as well, perhaps, as the
International Monetary Fund, given the nineteenth-century Rothschild's role in stabilizing the finances of numerous governments." While Rothschild did have some links to slavery, like most firms with global operations in the 19th century, the firm was instrumental in abolishing it by providing a £15m
gilt issue necessary to pass the
Slavery Abolition Act 1833. The money provided by Rothschild was used to pay slave owners compensation for their slaves and the gilt issue was only fully redeemed in 2015.
Late 19th century and their respective businesses Nathan Mayer's eldest son,
Lionel de Rothschild (1808–1879) succeeded him as head of the London branch. Under Lionel the bank financed the British government's 1875 purchase of a controlling interest in the
Suez Canal. Lionel also began to invest in railways as his uncle
James had been doing in France. In 1869, Lionel's son,
Alfred de Rothschild (1842–1918), became a
director of the Bank of England, a post he held for 20 years. Alfred was one of those who represented the British Government at the 1892
International Monetary Conference in
Brussels. The Rothschild bank funded
Cecil Rhodes in the development of the
British South Africa Company and
Leopold de Rothschild (1845–1917) administered Rhodes's estate after his death in 1902 and helped to set up the
Rhodes Scholarship scheme at
Oxford University. In 1873
de Rothschild Frères (trans. "The Rothschild Brothers") of
Paris and N M Rothschild & Sons of
London joined with other investors to acquire the Spanish government's money-losing
Rio Tinto copper mines. The new owners restructured the company and turned it into a profitable business. By 1905, the Rothschild interest in Rio Tinto amounted to more than 30%. In 1887, the French and English Rothschild banking houses loaned money to, and invested in, the
De Beers diamond mines in
South Africa, becoming its largest shareholders.
20th century The
First World War marked a change of fortune and emphasis for Rothschild. After the War, the Rothschild banks began a steady transition towards advisory work and finance raising for commercial concerns, including the
London Underground. In 1938, the Austrian Rothschilds’ interests were given to the
Nazis, bringing to an end more than a century at the heart of Central European banking. In
France and
Austria, the family was scattered for the duration of the
Second World War. After the war, the British and French banks committed themselves to further developing their new operation in the
United States, which was eventually to become Rothschild Inc, and increased focus on
mergers and acquisitions,
asset management, and
merchant-banking. In the 20th century, Rothschild secured key advisory roles in some of the most important, complex and recognizable mergers and acquisitions. In the 1980s, Rothschild took a leading role in the international phenomenon of
privatization. The company was involved from the beginning and developed a pioneering role which spread out to more than thirty countries worldwide. In recent years, Rothschild advised on nearly a thousand completed mergers and acquisitions with a cumulative value in excess of US$1 trillion. Rothschild also advised on some of the largest and most high-profile corporate restructurings around the world. The bank decided to enter the securities market buying Smith Brothers, a stock jobber, in December 1983. The
price of gold was fixed for years, twice daily at 10:30 am and 3:00 pm, in a small room at Rothschild's
New Court headquarters on St Swithin's Lane. The world's main
bullion houses:
Deutsche Bank,
HSBC,
Scotia-Mocatta and
Société Générale used the agreed rate as a
price benchmark for gold products and derivatives in the world's markets. The chairperson, traditionally appointed by the Rothschild bank, sat in the center, although the bank itself has largely withdrawn from trading. The five members of the London Bullion Association:
Barclays Capital,
Deutsche Bank,
Scotiabank,
HSBC and
Société Générale, now conduct their twice-daily meetings over the telephone. The meetings were a tradition as great as the ringing of the bell at the
New York Stock Exchange until 2004.
French history (Paris Orléans) 19th century The
Compagnie du chemin de fer de Paris à Orléans was founded in 1838 as a railway company. After several takeovers and a merger with the
Chemins de fer du Midi, it had about of track and was one of the major railway companies in France. In 1938, it was nationalised along with five other railway undertakings to form the national state railway company
SNCF.
20th century After the Second World War, the French branch of the Rothschild family took over the remains of
Paris Orléans and transformed it into a
holding company for its banking activities and corporate investments. These mainly included the
Banque Rothschild (bank), the
SGIM (property company), the
SIACI (insurance), the
Francarep (oil company) and the
SGDBR (wineries), now
Domaines Barons de Rothschild (DBR). By 1980, the Paris business employed about 2,000 people and had an annual turnover of 26 billion francs ($5 billion in the currency rates of 1980). The
Socialist French government of
François Mitterrand nationalized the
Banque Rothschild and renamed it
Compagnie Européenne de Banque in 1981. In 1983,
David de Rothschild and
Eric de Rothschild recapitalized the family's business just as their ancestors had done in the prior century under the name
Paris Orléans, as it was banned from using the family name until 1986, at which time the firm was renamed
Rothschild & Cie Banque.
Modern history and recent events Anglo-French Rothschild merger In 2003, the English (N M Rothschild & Sons) and French (Rothschild & Cie Banque) firms announced plans to merge under the leadership of David R. de Rothschild.
Paris Orléans SCA became the flagship holding company of the family business of Rothschild. Although
Paris Orléans is listed on the exchange, the family retains control of the firm. After the merger of the banking activities,
Paris Orléans SCA became the sole owner
Concordia BV, which controls
Rothschilds Continuation Holdings AG, which controls the Rothschild Group's banking activities. By 2011, the firm had merged operations and was unified.
Recent history In 2007, Rothschild formed joint venture Jardine Rothschild Asia Capital with
Jardine Strategic, specializing in growth capital investments. In 2010, the firm appointed the first non-family member chief executive officer, Nigel Higgins. In 2011, the firm rebranded from "N M Rothschild & Sons" to "Rothschild & Co." The goal of this was to show "a new global positioning as the fulcrum of the Financial Market." In 2015, the parent company Paris Orléans changed its name to Rothschild & Co to match the trade name of the business. In 2017, Rothschild & Co acquired the family-controlled French private bank
Martin Maurel. This merger united the businesses of two European financial families. After the acquisition, Rothschild & Co became the leading private bank in France. In 2018, Rothschild & Co sold its trust services division (responsible for the creation and administration of trust structures) to Richard Martin, a long-time Rothschild executive for an undisclosed amount. This restructuring of Rothschild's Wealth Management practice allowed the firm to focus more on its private banking activities from the recent purchase and integration of
Rothschild Martin Maurel. a global financial services firm that provides research in various coverage sectors and brokerage execution services for traditional and algorithmic sales and trading. In 2022,
Wintrust announced a deal to acquire the U.S. asset management arm of Rothschild, which held around $8 billion in assets under management at the time. In 2023, the
Rothschild family announced its intention to take Rothschild & Co. private by repurchasing the shares listed on stock exchanges. The transaction values the firm at €3.7bn and would end several decades of the firm being publicly listed. == Operations ==