Generali set to become one of Europe’s biggest asset managers through US-based Conning acquisition

Acquisition will increase Generali’s total assets under management (AUM) to $845 billion; will see Generali develop a long-term relationship with former Conning owner Cathay Life.

Generali has entered a definitive agreement to acquire US-based Conning from Cathay Life in a deal that will see it become one of the largest asset management firms in Europe.

The transaction is expected to be completed in the first half of next year subject to relevant approvals.

Cathay Life is expected to own a minority share of 16.75% of the share capital of Generali Investments Holding at closing, subject to customary closing adjustments.

Upon completion of the deal, Generali and Cathay Life will also enter into a wider 10-year asset management partnership to support Generali’s strategic asset management growth ambitions globally.

The transaction vastly expands Generali’s reach and capabilities – taking its total AUM to $845 billion. The acquisition of Conning, which has extensive long-standing insurance and institutional client base in the US and Asia, will also expand Generali’s remit in those regions and its capabilities across fixed income, structured and corporate credit, emerging market debt and private real estate.

“Through the acquisition of Conning and the long-term partnership with Cathay Life, we will enhance our asset management capabilities, strengthen our footprint in the key US and Asian markets, and create a platform to deliver on our broader asset management strategic ambitions in order to maximize value for all stakeholders, including Generali’s insurance business,” said Generali Group CEO, Philippe Donnet.

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Conning and its affiliates will continue to be led by the current management teams.

“As a client and shareholder since 2011, Cathay has enjoyed a long and successful partnership with Conning,” said Hong-Tu Tsai, chairman of Cathay Financial Holdings.

“We are now very excited about continuing to remain involved as a shareholder in Generali Investments Holding and to work together with Generali to support the continued growth of Conning. We also look forward to seeking new opportunities for further collaboration, including in the Asia Pacific.”

The deal joins a growing list of buy- and sell-side M&A deals announced this year. Most recent was Franklin Resources and Power Corporation of Canada which entered into a strategic partnership, which includes the acquisition of global asset management firm Putnam Investments by the former, in June.

In the same week, hedge fund Lansdowne Partners announced its plan to acquire UK equity investment manager, Crux Asset Management, dependent on regulatory approval. Earlier this year, UK asset manager Liontrust also entered into a conditional agreement to acquire Swiss asset management company, GAM Holding for £96 million.