Italy's Banco BPM bids for asset manager Anima, boosting shares of both
Deal looking to benefit from favourable capital rules
Will boost revenues from fees as rates decline
M&A was forecast among bank insurance units, fund managers
Anima shares close up 11%, Banco BPM gais 9%
Adds details on rules that triggered deal in paragraph 4-5; concerns over Amundi's investment in Anima in 9; absence of lack of control clause in Monte dei Paschi contract in 12; updates shares
By Valentina Za and Andrea Mandala
MILAN, Nov 7 (Reuters) -A bid by Italy's third-largest bank Banco BPM BAMI.MI to acquire full control of fund manager Anima Holding ANIM.MI sent shares of both soaring on Thursday.
Shares in the Milanese bank closed up 9%, hitting their highest level since January 2016, after it said that it would launch a 1.6 billion euro ($1.7 billion) bid for the Anima shares it does not own.
Banco BPM will use its insurance business, which allows it to minimise the use of capital thanks to favourable rules known as 'Danish compromise'.
The rules allow a bank to risk-weigh an insurance holding, instead of deducting it from capital.
The Danish compromise rule became permanent this year and authorities have clarified it also applies to the assets a bank buys via its insurance arm.
"A smart move on a smart company," Deutsche Bank said in a note, adding the impact on capital and returns was also "smart".
The proposed deal, which will prop up Banco BPM's revenues in the face of declining interest rates, is the latest sign of pressure to consolidate in the savings management industry.
Banco BPM's main shareholder is French bank Credit Agricole CAGR.PA, whose asset manager Amundi AMUN.PA had also taken a stake in Anima in 2022 through funds managed on behalf of clients.
Amundi's move had triggered concerns in Italy about the possibility that Anima, which is a large investor in Italian government bonds, could fall into foreign hands, after UniCredit sold its fund manager Pioneer to Amundi in 2017.
Barclays analysts said the deal raised a question mark over Anima's ability to preserve its partnerships, in particular for the sale of products to retail clients.
This would be the case, for example, of Anima funds sold to customers in branches of Monte dei Paschi BMPS.MI, which is 27% owned by the Italian state after a bailout in 2017.
The Monte dei Paschi contract runs to 2030 and does not include a change of control clause linked to Anima's ownership.
Shares in Anima rose 11% to 6.38 euros, above the 6.2 euros a share Banco BPM is offering other investors.
Bankers and analysts predicted a swoop by BNP Paribas BNPP.PA on the asset manager of insurer AXA AXAF.PA would encourage more banks to buy fund managers via their insurance arm, taking advantage of what Mediobanca Securities analyst Andrea Filtri dubbed "Danish Compromise Squared."
Banco BPM is Anima's biggest shareholder with a 22.3% stake. Anima is 9.8% owned by Italian private equity fund FSI, which is already a partner of Banco BPM in payments.
Poste Italiane PST.MI owns another 12% of Anima, which manages Poste's insurance reserves.
Banco BPM CEO Giuseppe Castagna said on Wednesday that some other institutional investors would be welcome to remain as Anima shareholders.
($1 = 0.9290 euros)
Reporting by Valentina Za and Andrea Mandala; Editing by Alexander Smith and Bernadette Baum
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
