UniCredit and Santander have signed a preliminary and exclusivity agreement to merge Pioneer Investments and Santander Asset Management (SAM).
Juan Alcaraz, current CEO of Santander Asset Management, will be the Global Chief Executive Officer, and Giordano Lombardo, current CEO and Group Chief Investment Officer (CIO) of Pioneer
Investments, will be the Global CIO of the new company.
The new firm will have approximately €400bn in assets under management.
The partnership between the two firms will provide for substantially enhanced economies of scale, a key advantage in the asset management industry, while also expanding the business’s diversification with respect to investment strategies, distribution channels and region.
Pioneer and SAM bring largely complementary platforms, investment capabilities, and client relationships, resulting in a more complete range of solutions and services to the benefit of all
It will have a presence in over 30 countries and exposure to both growing and well-established regions such as Latin America, North America, Asia, as well as a leading position in Europe.
The preliminary agreement will lead to the establishment of a holding company, with the name Pioneer Investments, which will control Pioneer’s US operations along with the firm resulting from
Pioneer and SAM’s operations outside the US.
UniCredit and the Private Equity Firms will each own 50% of the holding company, which will in turn own 100% of Pioneer US, and 66.7% of the combination of Pioneer and SAM’s operations outside the US, while Santander will directly own the remaining 33.3% stake. The combined firm will continue to operate as one global entity, led by a single global management team, focusing on meeting the needs of its clients worldwide.
The agreement is based on an Enterprise Value of €2.75bn for Pioneer Investments and €2.60bn for Santander Asset Management (including its 49.5% stake in AllFunds Bank). Furthermore, the transaction is estimated to enhance UniCredit’s capital position by approximately 25 basis points.