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September 17, 2017 at 06:35 AM
French insurer Axa S.A., the parent of AXA Equitable, is reviewing options for its European asset management unit amid consolidation in the sector, according to people familiar with the matter.
Axa is considering a merger or joint venture for the business, the people said, asking not to be identified because the details aren’t public. Potential partners could include Natixis S.A., the people said. Any transaction could be a precursor for an eventual initial public offering or partial sale, one of the people said.
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No final decisions have been made, and Axa may choose to retain the unit as is, they said. Representatives for Axa and Natixis declined to comment. Natixis, based in Paris, is controlled by Groupe BPCE, France’s second-largest banking group.
“This would be a transformational deal for Natixis as they want to expand in AM,” said Maxence Le Gouvello, an analyst at Jefferies in London with a buy rating on the stock. “A deal of this size would likely mean that BPCE ownership in Natixis would be diluted.”
Axa’s European asset management business reported annual sales of about 1.2 billion euros ($1.4 billion) in 2016, a 3% decline from a year earlier. Paris-based Axa Investment Managers oversaw 735 billion euros in assets as of the end of June, according to its website.
More Consolidation
A majority of asset managers expect that competition from exchange-traded funds and other index strategies, as well as more complex regulation, will force consolidation in the sector, according to a State Street survey in July. British insurer Standard Life P.L.C.’s approximately 4 billion-pound ($5.3 billion) merger with Aberdeen Asset Management P.L.C. was the largest deal of its kind in Europe this year.
Paris-based investment services firm Amundi S.A. is onThee model for consolidation in the sector. The company was created in 2010 when Credit Agricole S.A. and Societe Generale SA combined their asset management businesses. Societe Generale sold its entire stake in the company when Amundi listed in Paris in November 2015. The stock has climbed about 50% since the IPO, data compiled by Bloomberg show.
