Allianz sells $120bn assets of US business AGI to Voya after SEC ban

Insurance group  Allianz has signed a memorandum of understanding to transfer $120 billion of assets under management (AUM) of Allianz Global Investors (AGI US) to Voya Investment Management in return for an up to 24% equity stake in the enlarged asset manager.

Allianz has reached a final settlement of the Structured Alpha claims, costing it more than $6 billion, and AGI US agreeing to “plead guilty” to securities fraud and criminal misconduct, which will result in it losing its US licence.

The disqualification of AGI US from advising US registered mutual funds and certain type of pension funds after expiry of a temporary relief period does not affect Pimco or Allianz Life US.

On a pro forma basis, Voya IM’s AUM will rise to approximately $370 billion, and AGI’s AUM will drop from €430 billion Q1 2022 to €316 billion proforma.

According to Jefferies, the agreement will “negatively affect operating profit, but appears to be an economically fair solution for Allianz.”

“This is the consequence we had not foreseen, and is a negative,” analysts at Berenberg Insurance said. “The $120 billion AUM transfer from AGI is equivalent to 32% of Voya IM’s enlarged $370 billion assets, and Allianz will only gain a 24% stake in Voya IM.”

Allianz and Voya are working to finalise the terms of the asset purchase agreement and distribution arrangement.

Commenting on the announcement, Tobias Pross, CEO of AGI, said: “We are very much looking forward to beginning a new chapter in AllianzGI’s development with a partner in the U.S. that complements our own strengths and footprint, and supports long-term growth for both firms. AllianzGI’s stake in Voya IM will underscore our commitment to the global success of their soon-to-be enlarged business.”

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