Italy's third-largest Banco BPM (BAMI.MI) on Wednesday said it would launch a buyout offer to gain full control of asset manager Anima Holding (ANIM.MI) in an up to 1.6 billion euro ($1.7 billion) deal.
Banco BPM already owns 22% of Anima. The buyout offer, aimed at taking Anima private, is contingent on acquiring at least 67% of the fund manager.
Bringing Anima in house will boost Banco BPM's fee income, helping it to buttress profits in the face of declining interest rates.
The deal is the latest sign of consolidation in the savings management industry, where competition is increasing, and reflects a regulatory benefit for asset managers which are bought through bank's insurance arm.
BNP Paribas (BNPP.PA) earlier this year led the way by agreeing to buy the asset manager of French insurer AXA (AXAF.PA) through its BNP Paribas Cardif insurance business.
Banco BPM said once it completed the transaction, for which it is offering Anima shareholders 6.2 euros a share or a near 8% premium to Wednesday's closing price, fees and commission will account for more than 45% of core revenues from 37% at present.
Shares in Anima closed at 5.75 euros on Wednesday, for a year-to-date gain of 46%.
Banco BPM said it would carry out the deal through its BPM Vita life insurance unit with a view to coordinating the offer of life insurance and asset management products to clients.
The combination will give Banco BPM total assets from life insurance and asset management of around 220 billion euros.
According to BPM Vita, the completion of the deal, under the regulatory treatment of the so-called Danish Compromise, is expected in the first half of 2025.
Citgroup and Lazard are financial advisers to Banco BPM and Banco BPM Vita.
Banco BPM said the deal would only cost it around 30 basis points in terms of its core capital ratio, and would boost earnings per share by around 10%, lifting the return on tangible equity above 17% in 2026 from the current 13.5%.
($1 = 0.9317 euros)
