Amundi has effectively doubled its market share of the European ETF market to around 14 percent with the acquisition of Lyxor from Societe Generale.
The deal was announced last year but it has taken Amundi six months of ‘preparatory work’ to get the acquisition over the line.
According to Europe’s largest asset manager Amundi, it predicts that the deal will boost the firm’s already well-established passives division’s AUM by 50 percent by 2025.
Lyxor had been constantly battling DWS’s X-Trackers for second place in the European UCITS ETF market, a long way behind iShares with a nigh on 50 percent grip on the ever-popular asset class. However, a steady run of outflows saw Lyxor slip into third place and this is when Amundi looked to swoop.
A deal size of €825 million is not small change but it may well have dropped during a tumultuous time for Lyxor.
The fact that pre-IPO Societe Generale had a 20 percent stake in Amundi might be galling for the French banking giants and complicated by still existing partnerships between the two companies.
However, the benefits of the deal seem compelling. According to Amundi, it is expecting run-rate annual cost synergies of around €60 million with annual net revenue run rate synergies of about €30 million (both pre-tax). The costs saved by integrating IT and legal departments should be significant although is expected to take around two years.
Valérie Baudson, chief executive of Amundi said in a statement: “The Lyxor acquisition is another important step in the deployment of Amundi’s strategy. It elevates Amundi to the 1st position of European ETF providers and enriches our active management offering with a leading position in liquid alternative assets. The key managers of these two businesses have been appointed. Amundi is fully prepared to be the reference partner on these areas of expertise for both retail and institutional clients in Europe and in Asia, and thus to pursue its growth in two promising markets”.
