Societe Generale has entered into an exclusive negotiation with Amundi to divest its fund management business Lyxor.
Lyxor, an entity that encompasses the group’s asset management activities, is operated by the French bank’s fully-owned subsidiary Lyxor Asset Management.
Founded in 1998, Lyxor is said to be a pioneer in specialised asset management and a key player in passive asset management. The entity managed approximately €140bn in assets as of December 2020.
The proposed transaction covers Lyxor’s ETFs as well as active management activities for institutional clients in France and abroad. It also includes the sales and support functions related to these activities.
According to Societe Generale, the scope of the envisaged transaction is estimated to be €124bn of its total AUM.
Societe Generale CEO Frédéric Oudéa noted that the transaction is fully in line with the company’s strategy in terms of savings products.
It is looking to operate in open architecture and offer investment and asset management solutions to its clients through partnerships with external asset managers.
In connection with the move, Societe Generale intends to set up a ‘Wealth & Investment Solutions’ division within its private bank.
This division would act as a centre of expertise to structure savings, asset management and investment solutions for its private banking and retail banking networks.
It will also provide structured asset management solutions for global markets clients.
Wealth & Investment Solutions’ would include Lyxor’s teams, which would not be part of the disposal project.
Societe Generale expects the transaction to bring €825m. The company said that the capital gain from the disposal, net of tax, would be around €430m.
The agreement maintains a partnership with Amundi for the provision of savings and investment solutions for Societe Generale’s networks.
Additionally, Societe Generale will continue to support Amundi through a range of market solutions and securities services.
Oudéa said: “This transaction with Amundi, Europe’s leading asset manager, which Societe Generale helped to create, will enable Lyxor’s teams to play an active role in building the undisputed leader in passive management in Europe in a consolidating market.
“Societe Generale and Amundi will remain key partners, each participating mutually in the value proposition implemented for their clients. In addition, this transaction would successfully close the refocusing programme launched in 2018 by Societe Generale.”