Allianz Seeking Further Acquisitions

September 20, 2000

A number of recent reports confirm that Germany’s Allianz is aggressively seeking acquisitions in the U.K. and the U.S., but the giant German insurer has competition.

Last week several sources reported that Allianz was seeking to acquire San Diego based stock fund manager Nicholas Applegate for around $1.5 billion. The fund, which specializes in equity investment in small and mid sized technology companies, has had a spectacular record, and currently manages around $45 billion in assets. It would certainly complement bond fund manager Pimco, which Allianz acquired last year.

Applegate, however is also reportedly being sought by AIG and at least one other fund manager and a bank. As a result, according to the Wall Street Journal, the price could top $2 billion.

This week Reuters News Agency reported that Allianz is seeking to acquire Franklin Resources Inc., which manages the Templeton Funds Group with over $236 billion in assets under management, along with two other smaller fund managers.

Such acquisitions are increasingly expensive. Analysts estimate that Allianz could pay as much as 3 percent of assets for Franklin, over $7 billion.

The latest report in the Independent names Allianz as one of the prime candidates to take over Equitable Life, the U.K.’s oldest mutual life and pension insurer, which has been forced into a sale after an adverse court ruling concerning pension payments.

Its value is estimated at between £3 and £4 billion ($4.2 and $5.6 billion) and Allianz isn’t the only bidder, both Prudential (UK) and CGNU are reportedly prepared to make offers for Equitable.

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