Axa is set to sell private equity arm

AXA hopes to spark an auction after it finally confirmed it is interested in selling its private equity arm.

The French insurance group believes Axa Private Equity will go for between £200m and £400m.

Axa yesterday said it had begun a strategic review of its PE unit, which was set up by Dominique Senequier in 1996 and had €20bn (£17.41bn) of assets under control at 30 June.

Possible bidders could include US private equity giant KKR, which could not be contacted last night. City A.M. understands that Carlyle Group, another transatlantic firm viewed as a contender, is not considering making an offer.

Axa said its PE business had proved to be a “remarkable success” and any deal would be structured to preserve its investment expertise.

Analysts have said a sale of the unit would likely be as a response to the tougher capital requirements under the Solvency II rules aimed at bolstering the insurance industry’s financial strength.

MEET THE ADVISERS

CREDIT SUISSE

CREDIT Suisse has been tasked with handling the sale of the private equity unit of Axa, Europe’s second-largest insurer.

Despite rumours over the weekend that the PE arm could be worth up to $1.5bn (£961m), a price of £200m to £400m is more realistic.

Credit Suisse yesterday declined to reveal which of its advisers will handle the bidding process but they will be able to draw on the PE expertise of colleagues. The bank was one of three advisers appointed by CVC to advise on a possible $5bn initial public offering for Australian television network Nine Entertainment.

Earlier this month Carlyle Group said Credit Suisse would underwrite its planned IPO, alongside JP Morgan and Citigroup.

Axa was also advised by Credit Suisse in 2010 when it sold its UK life and pensions business to Resolution, Clive Cowdery’s insurance buyout vehicle.