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Amundi, Europe’s largest asset manager, is buying a private markets specialist as it becomes the latest mainstream investment group to look to expand its footprint in the fast-growing alternatives sector.
Paris-based Amundi said on Wednesday that it had signed a binding agreement for the acquisition of Alpha Associates, a 20-year-old company based in Zurich that manages €8.5bn of assets.
Adding Alpha Associates would bring Amundi’s assets in its private markets multi-manager business to €20bn. The acquisition price is €350mn, split between €160mn up front and €190mn based on hitting revenue milestones, according to a person familiar with the situation.
The French giant follows the likes of US peers BlackRock, Franklin Templeton and T Rowe Price in buying alternatives specialists to seek new avenues of growth — although the Alpha Associates deal is on a much smaller scale.
Amundi chief executive Valérie Baudson said the acquisition would allow the company “to significantly broaden its client base, capabilities and product offering, in a promising market”. The move is in line with the asset manager’s “strategic objective to increase our footprint in alternative and real assets in Europe”, she added.
Alpha Associates offers funds of funds that give institutional investors access to private debt, infrastructure and private equity strategies.
The deal will diversify the geographical footprint of Amundi’s private markets multi-manager business beyond its roots in France, Italy and Spain, into Switzerland, Germany and Austria. The multi-manager activities of both groups will be combined into a new business line.
The overall private capital industry rose to more than $10tn in 2021 and data provider Preqin has predicted this will grow to almost $18tn by 2026. One important driver of this growth will be the opportunity to target retail investors, who have historically had lower allocations to private markets than their institutional counterparts.
Amundi said the acquisition would help accelerate the development of private markets products for a segment in which retail clients were underinvested. Such investors might start by allocating to private markets through a fund of funds, rather than directly, because of the increased diversification it brought.
Amundi anticipates that the return on investment will be above 13 per cent after three years. The transaction is expected to be completed by the third quarter of this year, subject to regulatory approvals.
The announcement came as Amundi reported net inflows of €26bn in 2023, boosted by a strong fourth quarter and helping overall assets increase by 7 per cent last year, to €2.04tn. Adjusted net income grew 3.9 per cent during the year, to €1.2bn.
Amundi was created in 2010 by the merger of the asset management companies of Crédit Agricole and Société Générale. Its 2021 acquisition of Lyxor from Société Générale allowed Amundi to leapfrog German rival DWS and become the second-biggest player in European exchange traded funds behind BlackRock.
