By Valentina Za
MILAN (Reuters) - UniCredit (LON:0RLS) has struck a deal with asset manager Azimut Holding in a move that paves the way for the Italian bank to return to fund management a decade after it pulled away from the business.
Under the accord, whose financial terms were not disclosed, Azimut will set up a company in Ireland which UniCredit can acquire control of in five years at the latest. Azimut is expected to keep a minority stake.
CEO Andrea Orcel had been trying to renegotiate the terms of a deal struck by predecessor Jean Pierre Mustier who sold the bank's asset management activities to Amundi, striking a 10-year distribution agreement with the French asset manager.
Orcel was unhappy with minimum guaranteed levels under the Amundi contract but discussions have led nowhere and relations have soured, people with knowledge of the matter have said.
Asset management fees can help steady banks' earnings, making lenders less reliant on making money from loans. "This accord gives UniCredit the chance to re-internalise a fundamental piece of our asset management business," Orcel told a press conference on Friday.
"If it is a success, as we think it will be, it can be replicated elsewhere ... we start with Italy but we don't have to end with Italy."
Shares in Azimut jumped 6.7% following the letter of intent, topping Italy's blue-chip index. UniCredit rose 1.1%. Asked about the implications of the Azimut deal for the Amundi partnership, Orcel did not rule out UniCredit could seek other partners after 2027. "We always respect a contract ... [when that expires] there either will be another partnership or other partners," he said. Azimut's Irish asset management company will develop products to be distributed through UniCredit's network in Italy on a non-exclusive basis. A meeting with Irish regulators for the approval process is scheduled already on Monday. The launch of the first funds for Italian clients is expected in the second half of 2023 and Orcel said the accord would start having visible effects on earnings only from 2024.
Azimut Chairman Pietro Giuliani said Azimut, which currently attracts the majority of the assets it manages from abroad, would see a shift back towards Italian clients for a few years. "That's a price we're happy to pay to build an important, international asset manager in Italy," he said. The call option can be exercised earlier subject to circumstances which the two companies declined to detail.