Assicurazioni Generali and BPCE have agreed to combine their asset management units to create the world’s ninth largest industry player globally, with €1.9 trillion ( US$1.96 trillion ) in assets under management, and the leader in Europe with €4.1 billion in revenues.
Under a non-binding memorandum of understanding, Generali, through its Generali Investments Holding ( GIH ), and BPCE, through its Natixis Investment Managers, would each own 50% of the proposed joint venture, with balanced governance and control rights, according to a joint statement.
The combination would also create a global leader in insurance asset management by AUM, well-positioned to further expand in the growing third-party insurance asset management. In this regard, BPCE and Generali would retain full authority over asset allocation decisions for their respective assets.
In the statement, the firms underscore the critical necessity of scale in the fast-evolving asset management market, and as such, they would leverage their complementary geographical presence in France, Italy, and the United States, along with diversified expertise and a broad range of high-quality investment affiliates and teams.
The new company would leverage the two firms’ global distribution capabilities to serve all types of client needs with innovative, diversified investment strategies and solutions. It would also enhance offering in private assets to meet the growing expectations of clients in these asset classes.
The joint venture would benefit from a significant large pool of long-term insurance capital translating into a key strong competitive advantage for its combined network of affiliates, while offering both BPCE and Generali attractive opportunities to deploy their capital and seed new strategies to unlock new venues of growth, especially in private markets.
In line with its investment approach, Generali would commit to deploying €15 billion in seed and acceleration capital over five years across the affiliates forming the joint platform. This would enhance their capability to develop new investment strategies and contribute to further expansion of competencies and product offering, the statement says.
For the combined business, BPCE chief executive officer Nicolas Namias would serve as chairman of the board, with Generali CEO Philippe Donnet as vice chairman. Woody Bradford, the current CEO of GIH, would serve as CEO of the new entity, with Philippe Setbon, the current CEO of Natixis IM, as deputy CEO.