The world of insurance is moving. Axa, one of the global giants of the insurance industry, announced the start of exclusive negotiations with Bnp Paribas is preferably used for sale of Axa Investment managers. Value of the transaction of approximately 5,1 billion euros which could reach 5,4 billion euros, including an additional consideration of 0,3 billion euros deriving from the sale of Select to Axa IM before the conclusion of the transaction.
The deal, scheduled for completion by the second quarter of 2025, marks a restructuring for Axa, which would thus completely exit the asset management sector.
The merger will create a leader in the asset management sector
Axa Investment managers it currently manages almost 850 billion euros in assets. The merger with BNP Paribas will create a European leader in the asset management sector, with a total assets under management of 1.500 billion of Euro. The transaction carries a multiple of 15 times Axa IM's 2023 earnings, reflecting a robust valuation and strong confidence in the combined entity's future prospects.
“Axa Investment managers has been a success story for the Axa group. Over the past 25 years we have built an exceptional franchise anchored in investment expertise and a proven track record of sustainability,” he said. Thomas Buberl, CEO of Axa. “Joining forces with BNP Paribas, AXA Investment Managers will become a global asset manager with a broader product offering and with the common objective of strengthening its leadership position in responsible investments".
Strategic restructuring for Axa
Axa's decision to exit the asset management business is part of a broader strategy to simplify the business model and concentration on core insurance activities. With this move, Axa aims to focus more on its core insurance operations, optimizing its structure and resources to achieve greater efficiency and strategic focus.
The financial impact of the agreement includes a annualized reduction in Axa's underlying earnings of approximately 0,4 billion euros. However, the transaction will lead to an estimated one-off net profit of 2,2 billion euros. Axa's Solvency II ratio, which measures financial strength, is expected to remain neutral, suggesting that the transaction will have no adverse effect on the company's capital stability.
Axa acquires the Nobis group
In parallel with the negotiation for the sale of Axa IM, Axa has announced the acquisition of the Nobis group, a retail insurance company operating in Italy in Damage branch. Nobis recorded gross written premiums of 0,5 billion euros and a net profit of 35 million euros in 2023. The acquisition, which provides for an initial consideration of 423 million euros with a potential Earn Out of up to 55 million euros , represents a further step in Axa's strategy to expand and strengthen its position in the insurance market.
