AXA Investment Managers (AXA IM) has received an irrevocable offer from an investor group for its entire stake in AXA Investment Managers Private Equity SA (AXA Private Equity).
The proposed transaction would be structured with a view to protecting AXA Private Equity’s investment expertise and performance-driven culture, and to ensuring that its clients continue to benefit from the service and performance they have had over the past several years.
The transaction would enable AXA to monetize its interest in AXA Private Equity, a business developed by the group since 1996, and would provide a strong foundation for the next growth phase.
The acquiring investors would be composed of AXA Private Equity’s senior management, led by Dominique Senequier (pictured), a group of institutions and French family offices and AXA Group. AXA Private Equity’s 298 employees would be given the opportunity to participate in the transaction through a dedicated vehicle. Post-transaction, AXA would continue to invest in private equity through AXA Private Equity funds.
Upon the completion of the proposed transaction, AXA Private Equity’s voting share capital would be held as follows:
· AXA Private Equity’s management and employees: 40.00 per cent
· External investors: 33.14 per cent
· AXA Group: 26.86 per cent
The transaction would value AXA Private Equity at EUR510m for 100 per cent. The sale of AXA IM’s entire stake would result in AXA IM receiving a total consideration up to EUR488m. The consideration would be divided into an upfront payment of approximately EUR348m and deferred consideration up to EUR140m, to be paid in instalments subject to achieving certain targets and meeting certain conditions.
“We believe that private equity is an attractive asset class for the diversified investment portfolios of the group operating insurance companies. We intend to continue to invest in AXA Private Equity funds, with an expected total commitment of approximately EUR4.8bn between 2014 and 2018, as the firm pursues its purpose of supporting the growth of French and European companies and investing responsibly for clients around the world. The potential new shareholders in the capital of AXA Private Equity are strongly aligned in their commitment to ensuring that AXA Private Equity would be positioned to continue creating value for its portfolio companies and investors. I am convinced that going forward, thanks to Dominique Senequier, Vincent Gombault, Dominique Gaillard and their team, the company should continue to grow and foster its potential to the full of its ability,” says Gérald Harlin, group chief financial officer of AXA.
“The new structure for AXA Private Equity would deliver continuity valued by our clients, keep entrepreneurialism at the heart of what we do, and build a platform for new opportunities and broader horizons,” says Senequier. “We promised to develop a structure that keeps our talented team together and reinforces our investment approach, which is particular to AXA Private Equity. As we embark on this next phase of our story as an independent firm, our future will be one of capturing new opportunities borne out of the renewed confidence and vigour that will come with this deal.”
The proposed transaction would enable AXA Private Equity to become an independent private equity firm. With USD31bn (EUR24bn) assets under management raised from investors worldwide, the firm would offer its 255 investors a broad spectrum of asset classes: funds of funds, direct funds (comprising 160 portfolio companies), including mid and small market enterprise capital, infrastructure, innovation & growth, co-investment and private debt.
The proposed transaction is subject to customary conditions, including the completion of the works council consultation process and obtaining required regulatory approvals and should be finalized before the end of Q3 2013.
