Amundi has entered into exclusive negotiations to acquire fellow French ETF issuer Lyxor from Société Générale for a total cash consideration of €825 million.
Yves Perrier, Chief Executive Officer of Amundi.
The transaction is expected to be completed by February 2022 at the latest, subject to receiving the required regulatory and anti-trust approvals.
The purchase would shake up the leaderboard of European ETF issuers, catapulting Amundi from fifth to second-largest ETF provider by AUM.
According to Morningstar data as of the end of 2020, the combined ETF assets of Amundi and Lyxor would total €141.4 billion, representing a 13.4% market share in Europe.
This would give Amundi a notable lead over DWS which is currently Europe’s second-largest ETF issuer with total European ETF assets of €115.9bn (11.0% market share).
Amundi would, however, remain some way off challenging the dominance of BlackRock’s iShares which commands €466.3bn (44.3% market share) in ETF assets on the continent. The Morningstar data show that BlackRock strengthened its position at the top of the rankings in 2020 by gathering €51.1bn net inflows during the year.
Product consolidation
There is significant overlap in Amundi and Lyxor’s ETF ranges with product mergers a likely outcome of any acquisition.
Indeed, Amundi currently has five ETFs with over €1bn in assets that track identical indices to equivalent Lyxor products that also house over €1bn. These include funds tracking the S&P 500 (collectively housing €9.9bn), Euro Stoxx 50 (€7.0bn), MSCI Emerging Markets (€5.8bn), CAC 40 (€5.0bn), and MSCI Europe (€4.8bn).
Looking further down each issuer’s product line-up presents further opportunities for consolidation.
Amundi and Lyxor have both sought to increase their AUM in recent years by building out suites of low-cost core ETFs as well as socially responsible products, particularly focusing on funds that deliver climate-aware investment solutions. Each issuer, for example, offers a full range of Paris-aligned equity ETFs which may also be considered for consolidation. Amundi will, however, be able to add Lyxor’s successful green bond ETF to its line-up of sustainable products.
Accelerated development
Yves Perrier, Chief Executive Officer of Amundi, commented: “The acquisition of Lyxor will accelerate the development of Amundi, as it will reinforce our expertise, namely in ETFs and alternative asset management, and allows us to welcome highly recognized teams of people. This acquisition is fully in line with the Crédit Agricole group’s reinforcement strategy in the asset-gathering business. It will also further reinforce the business relationships with our historical partner Société Générale.”
Valérie Baudson, Deputy Chief Executive Officer of Amundi, added: “We are glad and are looking forward to welcoming the talented teams of Lyxor. The combinations of our strengths will allow us to accelerate our development in the ETF, alternative asset management, and the investments solutions segments.”
Frédéric Oudéa, Chief Executive Officer of Societe Generale, said: “This transaction with Amundi, Europe’s leading asset manager, which Societe Generale helped to create, will enable Lyxor’s teams to play an active role in building the undisputed leader in passive management in Europe in a consolidating market.”