Reuters: Private Equity: UPDATE 1-Suitors circle $1 bln Dexia Asset Management - sources

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UPDATE 1-Suitors circle $1 bln Dexia Asset Management - sources Apr 26th 2012, 12:29 Thu Apr 26, 2012 8:29am EDT By Simon Meads and Victoria Howley LONDON, April 26 (Reuters) - Buyout firms are vying with Australian group Macquarie for Franco-Belgian bank Dexia's $1 billion asset management arm, people familiar with the situation said on Thursday. State-supported Dexia is carving up its operations following a massive loss in 2011. Private equity groups Advent International, Bain, CVC , Permira and Warburg Pincus were among those which made offers for Dexia Asset Management, three people told Reuters. Bidders are waiting to hear whether they have been taken into the second stage of the sale which, according to one person, could see the business fetch up to 750 million euros ($988 million). The private equity groups and Australian bank and asset manager Macquarie declined to comment. Dexia, which also declined to comment, has been disposing of non-core operations to shore up its capital position. It recently agreed the sales of its half of RBC Dexia Investor Services to its partner Royal Bank of Canada and Banque International a Luxembourg to Qatari investment group Precision Capital. Despite its embattled position, booking a 11.6 billion euros loss for 2011 and saying it risked going out of business, Dexia has been unwilling to engage in a fire sale. It rebuffed an offer from Qatar National Bank for its Turkish unit Denizbank, for which it hopes to pull in up to $6 billion. Dexia Asset Management, which has centres in Brussels, Luxembourg, Paris and Sydney, presents itself as a specialist in responsible investment, offering 20 funds based on sustainable and responsible investment principles. It ended 2011 with 78 billion euros assets under management, generating 54 million euros pretax income. Private equity firms have long been attracted to asset management, drawn by its regular fee income and relatively low overheads. However, in competitive sales processes as banks jettison non-core divisions, they have been regularly been beaten by rival asset managers who have the firepower to pay more and can make savings thanks to synergies with existing businesses. Dexia chief executive Pierre Mariani flagged the start of the sale of the asset management arm in January, saying it had received more than 30 expressions on interest. The planned asset sales were first announced in October as part of a bailout plan to see Dexia broken up and control of its local-government lending arm merged into a new structure with French state-backed investors. Link this Share this Digg this Email Reprints

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