Yves Perrier

Amundi announces that it has entered into exclusive negotiations with Société Générale for the acquisition of Lyxor^[1] for a total cash consideration of €825m, or €755m excluding excess capital^[2].

Founded in 1998, Lyxor is a pioneer in ETF in Europe and has €124bn^[3] in Assets under Management (AuM). Lyxor is one of the key players in the ETF market (€77bn of AuM^[4], 3rd largest player in Europe with a 7.4% market share^[5]) and has developed a recognized expertise in active management (€47bn of AuM), notably through its leading alternative platform^[6].

Thanks to this acquisition, Amundi would become the European leader in ETF, with €142bn combined AuM, a 14% market share in Europe^[7] and a diversified profile in terms of client base and geography.

Amundi would benefit from strong levers to accelerate its development on the fast-growing ETF segment, while complementing its offering in active management, in particular in liquid alternative assets as well as advisory solutions.

Given the high synergy potential, this transaction compliant with Amundi’s financial discipline would be significantly value accretive, with:

• an enterprise value representing a P/E 2021e multiple of ~10x^[8], including run-rate cost synergies only
• ~+7% accretive on Amundi’s EPS 2021e, including run-rate cost synergies only^[9]
• return on Investment > 10% in year 3 after completion including run-rate cost synergies only

This acquisition is fully in line with the Crédit Agricole group’s strategy which aims at reinforcing its position in the asset gathering businesses.

The transaction is expected to be completed by February 2022 at the latest, after consultation of the Works Councils, and subject to receiving the required regulatory and anti-trust approvals.

About this announced entry into exclusive negotiations, Yves Perrier, Chief Executive Officer of Amundi, commented: “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 recognized teams of people. This acquisition is fully in line with the Crédit Agricole group’s reinforcement strategy in the asset gathering business. 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”.

Valérie Baudson, Deputy Chief Executive Officer of Amundi, added: “We are glad and are looking forward to welcoming the talented teams of Lyxor. The combinations of our strengths will allow us to accelerate our development in the ETF, alternative asset management and the investments solutions segments”.

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[1] Certain activities from Lyxor are excluded from the scope of the transaction and retained by Société Générale: (i) structured asset management solutions intended for Société Générale’s global markets clients and (ii) asset management activities dedicated to savings solutions and carried out for Société Générale (Branch networks and Private Banking) such as structuring of saving solutions, funds selection and the supervision of the Société Générale Group’s asset management companies
[2] Excess capital of €70m compared to asset management capital requirements applicable to Lyxor
[3] As of end December 2020, for the considered transaction perimeter
[4] As of end December 2020
[5] Source : Amundi, Lyxor, ETFGI, as of December 2020
[6] Liquid alternative assets investment platforms (notably UCITS funds) for private banks and asset managers
[7] 6.2% for Amundi standalone
[8] Based on a €755 price, excluding excess capital
[9] Based on consensus 2021e EPS, accounting for run-rate cost synergies

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Yves Perrier

Amundi has presented the results of its 2020 voting and engagement policy and outlines the actions that will be carried out in 2021.

During the 2020 campaign, we took part in nearly 4,250 general meetings of European and international companies – a 19% increase from 2019 – and focused our ongoing dialogue with companies and our voting policy on two major issues: the fight against climate change and social inequalities.

Amundi increased its support for shareholder resolutions calling for greater transparency and information on companies’ ESG and climate strategy, notably by voting for 86% of resolutions calling for a better integration of climate objectives. At the same time, the Group engaged in discussions on energy transition and climate change with 472 companies, and on the protection of ecosystems with 378 companies.

Amundi supported 88% of shareholder resolutions relating to executive compensation and 76% of shareholder resolutions that support human, health and social rights. We also voted against executive compensation plans that did not contain ESG indicators, resulting in 31% of negative votes on this issue. We were also particularly vigilant with regard to the amount of dividends paid out, particularly for companies having benefited from state aid. In parallel, we engaged in dialogue with 447 companies on the direct and indirect protection of employees and on human rights.

In 2021, in the run-up to the Glasgow Conference on Climate Change, Amundi’s two priority themes will continue to be energy transition and social cohesion.

Consequently, in addition to the necessary measurement of the carbon dioxide emissions trajectories of the companies in which we invest, Amundi will support resolutions calling for greater transparency on emissions reduction strategies, combined with specific targets. Similarly, we would like an increasing number of companies to make commitments to reduce their emissions in line with scientific objectives: the adoption of targets as part of the “Science Based Target” initiative (SBTi) will therefore be one of our main themes of engagement in 2021.

With regard to executive compensation, Amundi will ensure that it is in line with the company’s performance, at an acceptable level in relation to market benchmarks, and that it fully integrates specific ESG objectives, including annual variable compensation. With regard to dividends, Amundi will pay particular attention to ensuring that the distribution policy does not undermine the company’s long-term investment capacity, weaken its financial strength or lead to a distribution of value-added that is unfavourable
to employees.

“As an asset manager, Amundi has a duty to provide its investor clients with strong, consistent returns over the long term, together with a positive contribution to major social issues and the stability of economies. This responsibility has been particularly heightened in the context of the social crisis resulting from the pandemic, this at a time when the energy transition is barely gathering speed five years after the adoption of the Paris Agreement,” explains Jean-Jacques Barbéris, Head of Institutional and Corporate Clients division & ESG at Amundi.

“Since 2010, Amundi has been a pioneer in responsible investment and in 2018, we marked a new stage in our responsibility towards society with a three-year plan that includes systematically taking ESG performance into account in our shareholder dialogue with issuers and in our voting choices at shareholders’ meetings,” adds Amundi CEO Yves Perrier. “This strategy is applied in three complementary ways: ongoing dialogue with companies, the consideration of ESG criteria in investment decisions, and a voting policy incorporating these criteria”.

On 15th February 2021, Yves Perrier sent a letter to 500 CEOs and chairpersons of internationally listed companies, outlining these two priority issues that will guide Amundi’s voting policy in 2021.

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Yves Perrier

Amundi, the European leading asset manager, fully supports the efforts of the One Planet Sovereign Wealth Fund (OPSWF) Working Group dedicated to accelerating the integration of climate change analysis into portfolio management.

Alongside seven other asset managers, Amundi is proud to be a founding member of the One Planet Sovereign Wealth Fund Asset Manager Initiative to support the members of the OPSWF in their implementation of the framework setting out the three principles to accelerate the integration of climate change analysis into the management of large, long term and diversified asset pools.

This important initiative is well aligned with Amundi’s policy since its creation in establishing responsible investment as one of the 4 pillars of the firm.

Amundi already manages about EUR 280 billion of assets with ESG criteria. In line with its pioneering and longstanding commitment to responsible investment, Amundi announced in October 2018 a new ambitious ESG plan for the next three years.

• First, ESG analysis will be integrated across all Amundi funds by 2021.
• Second, Amundi will double the number of initiatives promoting investments in projects with an environmental or social impact.

Amundi has been driving some major initiatives in responsible investment. For example, in partnership with IFC, Amundi launched the largest ever green bond fund on emerging markets last year and announced earlier this week a new partnership with the EIB to further develop new green segments in the European fixed income universe.

Yves Perrier, CEO of Amundi commented, “We are thrilled that SWFs are engaging in climate change. This is fully aligned with Amundi’s position that has prevailed for years. And this is perfectly normal as we both share long-term investment horizons and duties to generate the best performance for our beneficiaries over the long-run.”

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