French insurer AXA is said to be close to a deal to spin-off its private equity investment arm to a management-led consortium, the Financial Times has reported.
It was in March this year that the French insurer unveiled the structure of a spin-off that would value its private-equity unit at 510 million (US$690.62 million), leaving AXA with a 26.9% stake in the business and a 200 million-euro capital gain from the sale of majority control to the unit’s management and staff.
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AXA PE head Dominique Senequier told the Financial Times that, AXA plans to reduce its stake in its former wholly-owned division to 21%, slightly less than previously indicated, due to the high demand from employees, who will now take 46% stake in the business and the rest going to other investors.
Under the terms of the deal, Senequier will own about 10% of the shares, while Assurances du Credit Mutuel and wealthy French families will own nearly 13% and 20%.
"Private equity has to be more about shared outcome, shared value and profit with investors, employees and companies we buy," Senequier said.
The spin-off is the latest sign of how tougher regulation following the financial crisis has prompted financial institutions to pull out of private equity units to concentrate their capital on more strategic activities.
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By GlobalDataThe firm will soon announce the closing of a fund targeting European leveraged buyouts, having raised about 2.5 billion.
