Swiss Life on Thursday said it was to spend SFr700m ($638m, €432m) in Germany, where last December it bought a leading network of financial advisers, to reinforce the Swiss insurance and pensions group in Europe’s biggest economy.
Some SFr200m will go on 10.46 per cent of AWD, the financial advisory group in which Swiss Life took a controlling holding this year. The shares are coming from Carsten Maschmeyer, AWD’s founder, who sold the bulk of his holding to Swiss Life in the initial transaction. The decision will give Swiss Life almost 97 per cent of the capital.
Separately, Swiss Life is to purchase 27 per cent of MLP, a rival financial advisers’ network. The shares are also held by Mr Maschmeyer, who has amassed the holding during recent months. The purchase will give Swiss Life a blocking minority in MLP, whose management rejected any loss of its independence.
Mr Maschmeyer will also invest at least SFr300m in Swiss Life, giving him a stake of about 3 per cent and making him the biggest individual shareholder.
Analysts welcomed Swiss Life’s expansion, but expressed regret at the group’s decision to limit its share buy-back to SFr1bn this year. Mr Maschmeyer had tried before to acquire MLP, but talks ended fruitlessly in April 2007.
Manfred Lautenschlaeger, MLP’s founder, repeated his hostility to a takeover and said he had no intention to sell his family’s almost one-third stake.
Mr Maschmeyer’s ability to build a large holding in MLP without detection renewed questions in Germany about stake building via options or other means. He accrued almost 8 per cent by options, and this week bought a large shareholding from Berenberg Bank, which only surfaced as a big MLP shareholder in July.