FN: Italian regulators block foreign sale of Pioneer

23 March 2011

The Italian central bank has made an attempt to block the sale of UniCredit’s asset manager, Pioneer Investments, to foreign buyers in a sign of growing protectionism and regulatory intervention.

Pioneer is one of Italy’s largest asset managers, with €186bn under management. Draghi fears that his country’s national interest will be damaged if the business ends up being bought by a foreign concern.

Resolution’s shareholders have since indicated they are not ready for a big asset management deal. UniCredit has been trying to persuade each bidder to pay as close to Pioneer’s book value of €3.2bn as possible to save the bank from a writedown. One source said the highest offer for Pioneer was €1.8bn, while another said it was closer to €3bn, but the prospect of any loss on disposal, which would diminish UniCredit’s capital adequacy ratios, would be unwelcome to the central bank.

Investment bankers said the current status of the bids was unclear. One said that Draghi’s intervention had come too late in the day: “There is every chance that the auction will collapse altogether.” They also described Banca d’Italia’s intervention as another sign of growing protectionism. They said Banca d’Italia’s intervention came soon after the Luxemburg regulator blocked the sale of Belgian KBC’s KBL European Private Bankers unit to an Indian suitor.

Corporate governance experts warned this year that a statute signed into law by French President Nicolas Sarkozy in December could be used by French companies to bar dissenting votes at shareholder meetings.

Banca d’Italia has proposed that the Italian founders of UniCredit – Credito Italiano, Rolo Banca, Cariverona, Cassa di Risparmio di Torino, Cassamarca, Cassa di Risparmio di Trento e Rovereto and Cassa di Risparmio di Trieste – should back the marriage of Pioneer with Eurizon Capital, owned by the bank Intesa Sanpaolo, although analysts said they were not convinced Eurizon, a more traditional Italian manager, would fit well with Pioneer.

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