Christopher Wright, head of Dresdner Kleinwort Capital, the private equity division of Dresdner Kleinwort Wasserstein, is relaxed about the implications on his business of Dresdner Bank's merger with German insurance group Allianz.
“From our point of view, we expect it to be very compatible and productive,” Wright told PrivateEquityCentral.Net, the website.
Talking about Dresdner Kleinwort Capital’s position within the investment bank, Wright said he remained comfortable with the current status but didn't explicitly rule out the possibility of a future spinoff. “Private equity is within Dresdner Kleinwort Wasserstein today, but is autonomous, and functions as a private equity business should,” he was quoted as saying.
He would not give details of what any future arrangements might look like. “The details of whom we might cooperate with with our friends in Munich have not been finalised,” he said.
Allianz already has a presence in the European private equity market. Allianz Capital Partners, the buy-out business led by Thomas Putter, has so far mainly concentrated on big leveraged buy-outs, although in March it led a smaller $8m round of financing for Round1, a financial services company. Dresdner Kleinwort Capital has tended to concentrate on mid-market buy-outs and technology investments. There is no obvious overlap between the two private equity divisions.
Being part of a leading financial services concern such as Allianz/Dresdner remains an attractive option for Dresdner Kleinwort Capital, which manages a number of third party funds whilst also having access to the bank's balance sheet money.
However there is speculation in the market as to what the future will hold for Dresdner's investment banking business as a whole. Allianz has said that it would establish Dresdner Kleinwort Wasserstein as a new subsidiary holding company and aim to float it at a stock exchange“within the next few years”. But market observers have questioned the viability of Dresdner Kleinwort Wasserstein as a stand-alone operation. Barclays and BNP Paribas were among the institutions cited yesterday as potential buyers of DrKW long before a flotation would take place.