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Cinven Pursues Insurance Platform Strategy with AXA Life Europe Deal

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Private equity firm Cinven, through Sixth Cinven Fund, made an “irrevocable offer” to acquire Dublin-based insurer AXA Life Europe Limited (ALE) in a deal estimated to be worth €925 million. ALE operates in Germany, the U.K., France, Spain, Italy, and Portugal. The insurance unit has not accepted new business since last year. It has €8 billion in assets and €5 billion in reserves. Furthermore, ALE is a reinsurer of AXA’s Japanese variable annuity portfolio. Private equity firms are hot for European life insurance businesses.

The deal could be effective as early as late 2018 or early 2019, and comes on the heels of the July 2018 acquisition of Viridium Group, a manager of life insurance portfolios in Germany. Caspar Berendsen, partner at Cinven, paints the picture of a much larger insurance conglomerate in the works, “Cinven’s acquisition of ALE is a ‘repeat play’ of the consolidation platforms we have created though Guardian Financial Services in the UK, Eurovita in Italy and Viridium in Germany. Cinven’s investment strategy, in this case, focuses on the consolidation of closed life funds with variable annuity offerings, primarily across Ireland and the Isle of Man.”

AXA Life Europe’s CEO, Eoin Lynam, is very much in favor of the potential sale. Lynam publicly praised Cinven’s expertise, “We have followed Cinven’s investments across various geographies in the European life insurance markets and it’s clear that they have a fantastic grasp of the opportunities available to ALE.” Cinven manages capital on behalf of investors globally. Sovereign wealth funds contribute a 16% share of Cinven’s capital. The Boards of the Guernsey Managers supervise the governance of the funds.

Advisors

JPMorgan provided financial advice to Cinven, while Clifford Chance was the legal advisor for Cinven. Deloitte was the tax advisor for Cinven.

GIC Supports CapitaLand Shanghai Investment on Haimen Road

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GIC Private Limited, Singapore’s sovereign wealth fund, has entered into a 50:50 joint venture with Raffles City China Investment Partners III (RCCIP III), a fund controlled by CapitaLand. The joint venture is acquiring Shanghai’s tallest twin towers for an aggregate consideration of RMB 12.8 billion (US$ 1.84 billion). The property is located in Shanghai’s core Central Business District.

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Wells Fargo Could be Slimming Down, Possible Retirement Unit Sale

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Wells Fargo (WFC) is looking to exit the retirement plan servicing market, for a potential sale price of US$ 1 billion. The unit is involved in record-keeping, custody, trust details and various other retirement plan services for corporations. It is housed under the Wealth and Investment Management unit. The retirement plan servicing market is not particularly compelling for the bank, especially in light of the U.S. Department of Labor’s newer regulations to force managers to disclose compensation arrangements and fees to plan fiduciaries. Wells Fargo has been lauded for its loyal consumer base and high revenue, and doesn’t require the business, though recent scandals have been a drag on the company’s profitability and public image. This news has pre-empted some advisors to jump ship. [ Content protected for Sovereign Wealth Fund Institute Standard subscribers only. Please subscribe to view content. ]

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Mubadala Petroleum Signs Deal to Buy Interest in Nour North Sinai Offshore Area Concession

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Mubadala Petroleum, a division of Mubadala Investment Company, signed a deal to acquire a 20% percent participating interest in Egypt’s Nour North Sinai Offshore Area concession. The seller of the interest is a subsidiary of the Italian energy giant Eni. Eni holds an 85% stake in the partnership with Tharwa Petroleum Company, which holds a 15 percent interest. Formed in 2004, Tharwa Petroleum Company is 100% owned by the Egyptian government through a variety of state-owned entities such as the Egyptian General Petroleum Corporation (EGPC) at 20% and Egyptian National Gas Holding Company (EGAS) at 20%.

The sales transaction is subject to conditions, such as approval from government authorities in Egypt.

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