Pioneer, Santander AM €400bn merger called off

The deal to merge the fund management businesses of Italy’s Pioneer Investments and Spain’s Santander Asset Management has been called off.

Unicredit has announced it has decided to end the agreement it entered into with Banco Santander and Sherbrooke Acquisition Corp, on 11 November 2015, regarding the merger of Pioneer Investments and Santander Asset Management.

The decision to scrap plans, that would have seen the Italian and the Spanish banking groups establish a European asset management firm with almost €400bn in assets under management, was announced in a statement issued by Unicredit earlier today.

“The parties held detailed discussions to identify viable solutions to meet all regulatory requirements to complete the transaction, but in the absence of any workable solution within a reasonable time horizon, the parties have concluded that ending the talks was the most appropriate course of action,” the company stated.

Unicredit said Pioneer will not be included in the scope of the strategic review launched on 11 July by the firm’s new chief executive Jean-Pierre Mustier, stating that the company now plans to “explore the best alternatives for all Pioneer stakeholders including a potential IPO.”

The company statement added that it will ensure Unicredit has the adequate resources to speed up growth and pursue product development that has been planned by the firm.

Merger complications

The merger has been hit by several complications during the negotiations, including changes in management at both banks and changes to the terms of the deal originally agreed by the two parties.

Following the release of the news, Unicredit’s shares have today dropped to €2.11 from €2.23 at close of trading on 26 May before stabilising around €2.16 in the end of the morning.

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