French PE subsidiaries change hands

Francois Rowell
18 March 2010

Tweet
Facebook
LinkedIn
Google plus
Send to

Consolidation in the French private equity market continues at pace: Natixis is closing in on a deal with Axa Private Equity over the sale of a part of its private equity division, while the IDI Group has acquired AGF Private Equity from Allianz France.

AXA PE initially made a €507m bid for parts of the Natixis private equity business in February and signed exclusive talk for a month, a period which has now been extended as it looks to wrap up a deal. The divestment is part of Natixis' planned reorganisation of its private equity assets announced last year in an effort to stem losses. The restructuring already seems to be bearing fruit for the bank which finally returned to profit in its fourth quarter. Meanwhile, IDI purchased AGF Private Equity from Allianz France this week, in an all-equity deal after a Rothschild-run auction process. This auction had also attracted a bid from Axa Private Equity.

As far as AGF PE is concerned, current announcements suggest that the unit will continue to operate autonomously under its new owner. The same situation is expected to play out in the Natixis/Axa PE deal: Natixis divisions iXEN Partners and NI Partners, which are due to merge, will continue to operate autonomously, as will the listed Initiative & Finance Gestion. Both AXA PE and Natixis are expected to support the units going forward.

In theory the overlaps in terms of resource are minimal in both cases. However, there have already been concerns from the AGF PE camp about the effect of potential synergies the acquisition might bring.

According to one source close to the deals, these latest moves are unlikely to signal a major push by French banks to dispose of their private equity units due to their general good health, but it is quite possible that other institutional investors might yet look to shed theirs. There are currently rumours circulating that an insurance group may be looking shed its private equity division and so we may yet see a more consolidation in the French market.