France's Primonial explores piecemeal sale of distribution, property units –sources

Rothschild & Co SCA

24/04/2023 18:47

By Pablo Mayo Cerqueiro and Amy-Jo Crowley
       LONDON, April 24 (Reuters) - French money manager
Primonial said on Monday that it is weighing a piecemeal sale of
its distribution and property investment operations, after a
deal to find a buyer fell apart last year.
    A spokesperson for Primonial said that it is considering
bringing in new investors for the distribution business, while a
deal for the remainder of the group would be sought later with a
"good international partner".
    The company, which oversees 47 billion euros ($51.84
billion) in assets and is backed by British buyout house
Bridgepoint  BPTB.L , is working with advisers at Rothschild &
Co  ROTH.PA  on the plans, people familiar with the matter told
Reuters.
    A sale process for the smaller wealth management
distribution unit is expected to begin in the coming months, two
of the people, speaking on condition of anonymity, said.
    The unit oversaw about 12 billion euros in assets at the end
of December and offers investment products through a network of
financial consultants as well as online.
    Rothschild has also been retained to advise on options for
the group's core real estate division Primonial REIM, but a
transaction is more likely next year, one of the people added.
Primonial REIM managed 35 billion euros of investments in 2022.
    Analysts and policymakers have flagged the commercial real
estate sector as a potential pocket of financial stress, as a
result of higher interest rates and lower occupancy levels since
the COVID-19 pandemic.
    The sale plans follow Primonial's disposal of its La
Financiere de l'Echiquier (LFDE) unit to La Banque Postale
earlier in the year.
    Bridgepoint acquired a majority stake in Primonial in 2017
for an undisclosed sum and later struck a deal with France's
Latour Capital to jointly hold 70% of the group. Societe
Generale  SOGN.PA  also owns a stake in the group through its
insurance arm.
    In 2021, the shareholders agreed to sell Primonial's real
estate and distribution businesses, alongside a 15% stake in
LFDE, to property developer Altarea  IMAF.PA  for up to 2.13
billion euros, including an earnout component.
    However, the buyer called off the deal last year, arguing
that certain conditions had not been met "in terms of substance,
form and timing".
    The parties have since been locked in a legal dispute, with
Altarea seeking redress through a Paris court in the amount of
150 million euros, according to a press release.

($1 = 0.9066 euros)

 (Reporting by Pablo Mayo Cerqueiro and Amy-Jo Crowley in
London; Editing by Elisa Martinuzzi and Sharon Singleton)
 ((Pablo.MayoCerqueiro@thomsonreuters.com;))