NN Group NV updates
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Goldman Sachs Asset Administration and Germany’s DWS are making ready bids for NN Group’s funding administration arm as consolidation within the trade gathers tempo.
The Dutch insurer mentioned in April it was contemplating a sale of NN Funding Companions, which has €300bn in property underneath administration.
The deadline for remaining binding presents is Monday. GSAM, which has greater than $2tn in property underneath supervision, and Frankfurt-based DWS are nonetheless within the sale course of and making ready bids, mentioned folks conversant in the state of affairs.
The deal worth is within the area of €1.4bn, one of many folks mentioned. NN Group, GSAM and DWS declined to remark.
UBS Asset Administration, Janus Henderson and US insurer Prudential Monetary are amongst these to have beforehand registered their curiosity. All three declined to remark.
Funding managers globally are embarking on mergers and acquisitions designed to defend income from rising prices and falling charges, whereas in search of to faucet into fast-growing markets comparable to passive investing, non-public property and ESG, and open up new distribution channels.
“The aggressive atmosphere for conventional lively asset managers has intensified and a smaller group of bigger gamers at the moment are dominating the institutional section,” mentioned Vincent Bounie, senior managing director at Fenchurch Advisory, a specialist funding financial institution for monetary companies.
“It has grow to be sophisticated to develop and really tough to have a worthwhile enterprise, particularly if in case you have undifferentiated plain vanilla merchandise.”
Asoka Woehrmann, chief govt of DWS, which is majority owned by Deutsche Financial institution, advised shareholders on the €820bn group’s annual assembly final month that it wished to be “an lively participant” in trade consolidation. It’s in search of additional scale to problem rival Amundi for supremacy in Europe.
In the meantime for insurance coverage corporations, a protracted interval of low rates of interest and better capital necessities underneath Solvency II guidelines is prompting teams to weigh up the place they allocate their capital, Bounie mentioned. “For a lot of of them, subscale asset administration divisions are not core actions and there’ll in all probability be extra divestments.”
NN Group, which is predicated in The Hague, got here underneath strain final 12 months from activist hedge fund Elliott Administration to enhance returns and streamline its operations. It mentioned in April it was contemplating choices together with a merger, three way partnership or a partial divestment of the division.
NN Funding Companions has about 950 staff. Of its €300bn in property underneath administration, two-thirds is managed on behalf of its insurance coverage father or mother firm with the remaining third run for exterior buyers.
The division’s vary of funds covers mounted earnings, fairness, multi-asset and various funding methods. It has a powerful place in ESG investing, notably in areas comparable to inexperienced bonds, impression fairness and sustainable fairness.
Further reporting by Ian Smith in London