Amundi Asset Management has entered into exclusive negotiations with Societe Generale to acquire Lyxor Asset Management.
Subject to regulatory and trust approvals, it is expected to complete by February 2022 at the latest.
The price tag is €825m, or €755m excluding excess capital.
It comes more than four years after Amundi bought Pioneer for €3.54bn.
Founded in 1998, Lyxor has €124bn of assets under management.
It is the third largest player in the European ETF market, with a 7.4% market share and AUM of €77bn.
The deal would see Amundi become the European leader in ETF, the firm said, with €142bn combined assets under management.
Once the acquisition closes, it would hold a 14% share in the European ETF market – up from 6.2% at present.
There are certain activities from Lyxor that are excluded from the M&A deal and will be retained by Societe Generale.
- structured asset management solutions intended for SocGen’s global markets clients; and,
- asset management activities dedicated to savings solutions and carried out for SocGen – branch networks and private banking – such as structuring of saving solutions, funds selection and the supervision of the group’s asset management companies.
Commenting on the exclusive talks, Dan Izzo, chief executive of liquidity provider GHCO, which specialises in ETFs, said: “The sale of Lyxor will play a significant role in shaping the European ETF industry over next decade, although clearly the US is still the dominant market in terms of scale.
“Europe’s largest issuers have been competing for supremacy for a number of years now and this is a strong move for Amundi in the context of surging popularity of passive investment products.
“The combined group will be the second largest issuer in Europe and we look forward to working them and others to help improve liquidity in ETFs across the six major European exchanges.”
Steve Libby, AWM Leader in Europe for PwC, added: “The growth of exchange traded funds has continued its rapid pace in Europe, with assets held in European-domiciled ETFs rising by 13.9% from Q4 2019 to Q4 2020 alone.
“In order to effectively compete in this market scale is critical. The potential acquisition of Lyxor by Amundi would provide additional scale to Amundi’s existing ETF business.”