Citywire Selector | French giants considering partnership with asset management firms, reports suggest

French asset management giants Axa and BNP Paribas are in talks to merge, according to a Bloomberg report.

The two groups are said to be studying “the creation of a joint venture between Axa Investment Managers and BNP Paribas Asset Management,” Bloomberg reported, citing sources close to the matter.

Respectively the third and fourth largest asset managers in France in terms of assets, Axa IM and BNP Paribas AM together manage nearly 1,400 billion euros of assets under management.

According to American media sources, discussions are underway but there is no indication that they will result in a transaction, especially since Axa is also studying mergers with other French management companies.

Contacted by Citywire, BNP Paribas declined to comment on the information. A spokesperson for Axa said the company “does not comment on market rumours”.

The talks come as Axa is considering the future of its asset management business. The French insurer is keen to participate in the ongoing consolidation in the sector, which has accelerated in recent months, particularly in the private markets sector.

Traditional players are increasingly looking to move into private equity, private debt and infrastructure, such as BlackRock with its recent acquisition of Global Infrastructure Partners and Amundi with its purchase of Alpha Associates.

The pressure on traditional management margins has prompted players to significantly increase their assets under management, or to find new, more profitable financial windfalls, as is the case on private markets.

In Europe, the rise of ETFs, which are constantly gaining market share, is another element that puts pressure on active management and encourages the market to consolidate.