Deutsche Bank's Asset Manager Is Examining Growth Partners
(Bloomberg) -- Deutsche Bank AG’s asset management arm has held preliminary talks on teaming up with firms including UBS Group AG and Axa SA as it looks for ways to boost its size, people familiar with the matter said.
DWS Group is considering various options including joint ventures and distribution partnerships, the people said. The company isn’t looking at scenarios where Deutsche Bank would lose control over the unit, the people said.
DWS Chief Executive Officer Asoka Woehrmann has been focusing on cost cuts since he was appointed to the role last October while seeking to stem four quarters of client money outflows. The company’s assets under management are low compared to many other international money managers, raising questions about the need to boost DWS’s size through means other than organic growth in an industry that’s increasingly driven by economies of scale.
It’s not clear whether there’s a preferred option or if any decision is imminent, the people said, asking not to be identified because the matter is private.
Representatives of DWS, UBS and Axa declined to comment on the story.
German insurer Allianz SE, UBS and France’s Amundi SA would all be potentially interested in a tie-up with DWS, people familiar have said. Analysts have speculated that Deutsche Bank may sell the company as one way to cover the costs of a potential takeover of rival Commerzbank.
DWS suffered outflows of 22.3 billion euros ($25.1 billion) of client money last year and its stock dropped almost 30 percent in the nine months between its initial public offering and the end of 2019. The share price has rebounded strongly since the beginning of the year, not least driven by M&A speculation, and is almost back to the IPO level.
Woehrmann is currently working on a strategic review of the business and plans to present the results during the second quarter, people familiar with the matter have said. The review is likely to result in accelerated cost cuts and he may discard some of the financial targets set by predecessor Nicolas Moreau before the IPO.
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