After Liberty Seguros Generali acquires Conning Holdings, global asset manager dedicated to insurance and institutional clients, from Cathay Life, a subsidiary of Cathay Financial Holdings, one of the largest financial institutions in Asia. The announcement comes directly from the Leone company which underlines that following the contribution of Conning Holdings to Generali Investments Holding, Cathay Life will become a minority shareholder of the latter with approximately 16,75% of the capital and will launch a broader partnership with Generali.
Generali and the acquisition of Conning
Conning and its subsidiaries are "among the leading global asset management companies dedicated to insurance companies and institutional clients", underlined Generali. All together they have approx 157 billion dollars (144 billion euros) of assets under management. Scope of operations includes Conning (fixed income instruments for insurance and institutional clients), Octagon Credit Investors (bank loans, CLOs and alternative credit), Global Evolution (emerging markets debt) and Pearlmark (debt and equity for real estate) . Thanks to this transaction, Generali's total assets under management increase to 845 billion dollars,775 billion euros, making the Trieste company the ninth player in Europe.
"There is no cash consideration owed by Generali or by Generali Investment Holding to Cathay Life at closing. Furthermore, a marginal impact on the group's Solvency II Ratio is expected”, concludes a note.
Under the terms of the agreement, as part of Generali, Conning and its subsidiaries will continue to be led by the current management teams and by Woody Bradford, chief executive officer and president.
Finally Generali and Cathay Life have started a long-term partnerships which provides for the participation of Cathay Life in an asset management agreement with a minimum duration of 10 years: in detail, Generali's Asset Management, together with Conning and its subsidiaries, will continue to manage certain AUM in the insurance field owned by Cathay Life. The two companies have also agreed on earn-out mechanisms which may become payable in cash starting three years after the closing, upon the achievement of predetermined conditions.
CEO Donnet: "We are growing in the United States and Asia, a unique opportunity"
Generali CEO Philippe Donnet said: “Through the acquisition of Conning and the long-term partnership with Cathay Life, we are strengthening our asset management expertise, expanding our presence in key markets such as the United States and Asia. We will also develop a platform capable of realizing our strategic ambitions in asset management and creating value for the benefit of all stakeholders, including the group's insurance business. This unique opportunity is fully aligned with the strategic and financial objectives of our 'Lifetime Partner 24: Driving Growth' plan and allows us to further expand our asset management ecosystem.”
Carlo Trabattoni, CEO Asset & Wealth Management of Generali, he pointed out: “This transaction favors the creation of sustainable value for both companies and for third party customers, thanks to the strong complementarity between the Asset Management of Generali and Conning. It also reinforces our ambitions and positioning as the world's leading distributor of diversified investment solutions, with new expertise dedicated to insurance companies and institutional clients. For our asset management business, the benefits are significant, thanks to the integration of differentiated and high-quality investment capabilities”.
