Unicredit may sell Pioneer in pieces, sources say

Unicredit Group SPA will send out the pitch book next month for its Pioneer Global Asset Management SPA unit — with a breakup of the subsidiary likely, according to investment bankers familiar with the discussions.

Unicredit Group SPA will send out the pitch book next month for its Pioneer Global Asset Management SPA unit — with a breakup of the subsidiary likely, according to investment bankers familiar with the discussions.
In May, the Italian bank said that it had hired Bank of America Merrill Lynch to evaluate selling Pioneer Global Asset Management, including its U.S. fund arm, Pioneer Investment Management USA Inc. And while there are a number of European banks interested in Pioneer, many bankers believe that Unicredit could get a better deal if it broke up the business and sold the U.S. arm separately.
“The tide of gossip has turned more to that they will split the business because they can get a better valuation,” said one banker. “They started out saying it’s going to be one transaction, and the more work they do, they are more open to bifurcating it.”
Elisabetta Usuelli, a spokeswoman at Unicredit, didn’t return a call and e-mail requesting comment.
Pioneer, at the end of April, ranked as one of the 50 largest retail fund management operations in the U.S. (see the top 100 here).
In Europe, Natixis, BNP Paribas and Amundi Asset Management, the joint venture Crédit Agricole Asset Management and Société Générale Asset Management are rumored to be interested in buying Pioneer Global, which has $228 billion in assets under management. During an investor earnings call earlier this month, Natixis managing director Laurent Mignon confirmed that the firm would be interested in Pioneer Global.
Alain Berry, a spokesman for Amundi, and Christelle Maldague, a spokeswoman at BNP Paribas, declined to comment.
The concern that potential buyers may have about acquiring all of Pioneer Global is whether it would be able to sell Pioneer’s funds through Unicredit’s bank branches, bankers said.
Much of the value of a deal would depend on how much distribution the buyer could get, they said. “If Unicredit says it will sell these funds as preferred funds over the next five years, that would get a much better deal than if they said they will just have them on the platform for three years with other funds,” said one banker.
The U.S. business, which has $56 billion in assets under management, has a number of suitors, with John Hancock Funds LLC, MFS Investment Management, and Eaton Vance Investment Managers topping the list, bankers said. All three companies are midsize fund companies with a presence in Boston, where Pioneer is also headquartered. Dan Flaherty, a spokesman for MFS, declined to comment, as did Robyn Tice, a spokeswoman at Eaton Vance. Keith Hartstein, president of Hancock Funds, didn’t return calls by press time.
Private-equity firms, such as TA Associates Inc. and Hellman & Friedman LLC, are also likely to look at the U.S. outfit, said one banker.
“It’s a platform that every private equity firm could use,” the banker said.