ZURICH (Reuters) - Swiss private bank Julius Baer will buy Commerzbank AG’s Luxembourg private banking franchise that has close to 3 billion euros in assets under management, Baer announced on Wednesday.

“The total consideration is approximately 68 million euros, assuming 25 million euros of regulatory capital is transferred as part of the transaction. Total restructuring and integration costs are expected to amount to approximately 20 million euros,” it added in a statement.

The deal was set to close in mid-2016 and would be accretive to adjusted earnings immediately following closing, Baer said.

Julius Baer’s Luxembourg-based business will manage total assets of around 5 billion Swiss francs ($5.05 billion) on a pro-forma basis once the deal goes through.

Julius Baer Chief Executive Boris Collardi said buying a fully licensed bank in Luxembourg with its Temenos-based booking centre and related IT expertise provided strategic flexibility for Baer’s European businesses.

“Furthermore, it strengthens the implementation of our global banking platform project by aligning Europe with our Swiss and Asian platform strategy, thus reducing the execution risk,” he added.

Julius Baer this year selected software group Temenos as its partner for planning its core banking platform renewal project.

Gustav Holtkemper, chairman of Commerzbank International SA Luxembourg (CISAL), called Baer a good partner for its clients and staff.

“Since 2009 we have been gradually bundling our competences in international wealth management in Germany. In the framework of this strategic orientation we have decided to sell our activities in Luxembourg,” he said.

(Reporting by Michael Shields in Zurich, Additional reporting by Maria Sheahan in Frankfurt; Editing by Stephen Coates and Biju Dwarakanath)