Dexia has announced that it has reached an agreement with New York Life Investments for the sale of its fund management division, Dexia Asset Management (Dexia AM).
The New York investment management firm paid €380m for Dexia AM which has hubs in Brussels, Paris, Luxembourg and Sydney. As of 31 July, Dexia AM had €74bn in assets under management of which €327.2m is invested in structured products in Belgium.
Earlier this year Dexia, pulled out of a deal to sell its fund manager to GS Capital - an investment group based in Hong Kong - because the sale could not be completed by the June deadline. GS Capital was also prepared to pay €380m for Dexia AM.
Dexia AM has launched 117 structured funds in Belgium since 1999. The products, which had a total sales volume of €2.5bn, struck between August 1998 and December 2011. Of these, 33 products (€327.2m) are still live and will be serviced by New York Life Investments.
The sale is part of a restructuring plan which Dexia Group is required to implement in order to meet the European Commission's conditions for the support it received from the Belgian government during the credit crisis. In an earlier phase, Dexia Bank Belgium was sold to the Belgian state and then changed its name to Belfius Bank, to distance itself from the listed company Dexia Group.
Belfius Bank is an active structured products provider in Belgium but has seen its market share eroded during 2013 to 5% (€346m in sales year-to-date) from the 11% it held in 2012 (€971m in sales).
New York Life Investments is a subsidiary of New York Life Insurance Company and has $388bn assets under management, as of 31 July 2013.
The transaction remains subject to the approval of the regulatory authorities.