The asset-management arm of Italian asset management firm Generali Investment Holdings will acquire Conning Holdings, a leading player in esoteric asset-backed securities, the latter announced on July 6, a deal likely to present new business opportunities for Conning.
This is the second time in recent years that Conning has gone through an acquisition. In 2015 it had been acquired by Cathay Financial Holding, based in Taiwan. Conning caters to insurers and insurance industry investors. When the Generali transaction is completed, anticipated in the first half of 2024, Cathay will enter into a partnership with Generali in which it receives a 16.75% ownership stake in GIH.
Conning and its affiliates will continue to operate independently under their current management teams. They are expected to receive ongoing strategic support from Generali and Cathay, including additional assets to manage, collaboration in seeking new strategies, and exploring potential business-growth investments. They will also share best practices and leverage GIH's shared operational and risk frameworks.
Conning's majority-owned affiliates include Octagon Credit Investors, which manages nearly $33 billion in below-investment grade credits; Global Evolution Holdings, specializing in emerging and frontier markets; and Pearlmark Real Estate. Conning and its affiliates manage more than $157 billion in assets globally.
"We believe this transaction provides stability for our clients and employees, maintains continuity of leadership and strategy, and will generate new collaboration opportunities with Generali and its affiliates to strengthen both firms," according to a statement from Woody Bradford, CEO and board chair of Conning Holdings.
Conning turned its attention to esoteric ABS in 2012, as financial markets recovered from the Great Financial Crisis. In a recent interview with Asset Securitization Report
Generali Asset Management explained that the company will benefit from adding Conning and its affiliates' long-standing insurance and institutional client base in the U.S. and Asia.
"Through the acquisition of Conning and its affiliates, and the long-term partnership with Cathay Life, Generali will enhance its asset-management capabilities, strengthen its footprint in the key U.S. and Asian markets, and create a platform to deliver on its broader asset management strategic ambitions …," according to Philippe Donnet, Group CEO of Generali.
