Amundi is set to acquire European ETF house Lyxor for a total cash consideration of €825m, having entered into exclusive negotiations with parent group Société Générale.
The acquisition, which could also cost the French asset manager €755m excluding excess capital, would turn Amundi into Europe's largest ETF provider with combines AUM of €142bn and a 14% market share.
Amundi said the acquisition of Lyxor, which with €77bn in AUM is the third largest player in Europe's ETF market with a 7.4% market share, would provide the combined business with "a diversified profile in terms of client base and geography".
The French asset manager also noted that the acquisition would allow Amundi to "accelerate its development" within the ETF market and complement its active offering, particularly within liquid alternative assets as well as advisory solutions.
Based on a €755m figure, the deal would create an estimated enterprise value representing a price-to-earnings 2021 multiple of around 10x, including run-rate cost synergies.
Amundi said it would see a return on investment worth more than 10% in year three after completion, including run-rate cost synergies.
The transaction is expected to be completed by February 2022 at the latest, subject to receiving the required regulatory and anti-trust approvals.
Yves Perrier, CEO of Amundi, said the acquisition of Lyxor "will accelerate the development of Amundi, as it will reinforce our expertise, namely in ETF and alternative asset management, and allows us to welcome highly recognised teams of people".
"This acquisition is fully in line with the Crédit Agricole group's reinforcement strategy in the asset gathering business," he added. "It will also further reinforce the business relationships with our historical partner Société Générale.
"Finally, by creating in France the European leader in passive asset management, it will contribute to the post-Brexit positioning of the Paris financial centre".
Deputy CEO of Amundi Valérie Baudson said: "The combinations of our strengths will allow us to accelerate our development in the ETF, alternative asset management and the investments solutions segments."
First published by our sister title Investment Week