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UniCredit and Santander to merge asset management businesses in $5.8 billion deal

Staff writer |
UniCredit and Banco Santander agreed to merge their asset management businesses in a deal valuing the new group at 5.4 billion euros ($5.8 billion).

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The deal, will create one of Europe's leading asset gatherers with 400 billion euros under management and total net inflows last year of more than 25 billion euros.

The two banks said in September they were in talks to merge Santander Asset Management and UniCredit's Pioneer division but the transaction took time to complete because of its complex structure.

Under the deal, UniCredit and private equity funds Warburg Pincus and General Atlantic will each own 50 percent of a new holding company called Pioneer Investments that will own all of Pioneer's U.S. operations. The two private equity funds are already partners in Santander's asset management unit.

The new holding company will also own 66.7 percent of Pioneer's and Santander Asset Management's operations in the rest of the world. Santander will own the remaining 33.3 percent.

"The agreement is based on an enterprise value of 2.75 billion euros for Pioneer Investments and 2.6 billion euros for Santander Asset Management," UniCredit said. It said the deal would strengthen its capital position by 25 basis points.

The operation is subject to the customary regulatory and corporate approvals.

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