Will Italy Force Pioneer to Stay Italian?
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Monday, March 21, 2011

Will Italy Force Pioneer to Stay Italian?

Unicredit may not be able to sell Pioneer Investments [see profile] to Amundi, Natixis [see profile] or Resolution after all. Financial News' Mike Foster and William Hutchings report that the chief of Italy's central bank told Unicredit (which is an Italian bank) to try selling Pioneer (a mulitnational asset manager and mutual fund firm) to an Italian buyer, perhaps by merging Pioneer with Eurizon Capital (a subsidiary of Intesa Sanpaolo). [See MFWire's living timeline of the Pioneer auction for more details and history.]

Financial News lists Amundi and Natixis (both French) and Resolution (British) as the remaining bidders for Pioneer as of late 2010, with Amundi offering stock and Resolution offering cash. The paper lists several motivations for the intervention by Banca d'Italia governor Mario Draghi: a desire for Unicredit to avoid taking a loss on the sale; another example of "growing protectionism" in Europe; and a desire for Pioneer to help Italians (directly and indirectly) to continue to buy Italian government bonds.

Meanwhile, last week the Wall Street Journal's Joe Ortiz reported on the importance of the Pioneer sale to Unicredit, as the bank works to be compliant under the new Basel III capital ratio rules (set to take effect in 2013)

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