Private Equity News & Analysis

Groupama sells off private equity arm

The French insurer has sold its private equity arm to ACG Group, and also offloaded its interests in the direct private equity funds managed by Acto Capital.

-

Groupama, a French insurer, has sold 100 percent of Groupama Private Equity (GPE) to ACG, a fund of funds group, as part of its efforts to dispose of non-core assets.

The sale, which is subject to regulatory approval, is expected to complete by the end of the first quarter of 2013, according to a statement. 

The auction process was led by UBS, Wladimir Mollof, chairman of ACG Group told Private Equity International. Both ACG Group and Groupama declined to comment on the transaction value.

ACG will take over €1.6 billion of assets managed on behalf of both Groupama as well as third-party institutional clients. €1.4 billion of these assets are in fund of funds and €200 million in mezzanine funds, with a new mezzanine fund being raised for another €200 million, Mollof said.

The portfolio has commitments to funds both in Europe and the US in “some very well-known buyout funds and some very well-known venture funds”, Mollof added.

“It’s a strategic decision that many institutions are taking”, he added, pointing towards increased regulations such as Basel III and Solvency II. “Let’s not forget that the private equity sector started exactly this way in the US where you had institutional investors in general investing in funds managed by independent groups.” Independent groups are best suited to optimise the investment process, he added. “It’s back to that fundamental of the business in my view,” he said.

ACG, which manages approximately €2 billion, will have €3.7 billion under management following this sale, Mollof said.

In addition, Groupama has sold its interests in the direct private equity funds managed by Acto Capital. These interests in FCPR Acto and FCPR Acto Capital II will be acquired by Luxempart and Five Arrows Secondary Opportunities III, which is part of the Rothschild Group, according to the statement.

Acto Capital’s team will be transferred to a new management company which is in the process of obtaining regulatory authorisation from the Authorité des Marchés Financiers, the French financial watchdog.

Groupama will retain its interest in the two other private equity funds managed by Groupama Private Equity, which are funds of funds and mezzanine debt.