Axa plans to float its US asset management and insurance businesses in the first half of 2018 to release capital.
The firm currently has two separate asset managers: Axa AB in the US and Axa IM in Europe.
Chief Executive Thomas Buberl says the flotation will strengthen Axa’s capital position and benefit the US operations in terms of regulation, Reuters reports. The proceeds of the IPO will be reinvested in Axa’s core businesses, such as health insurance and property, with some cash returned to shareholders.
“We are convinced our US operations would be better positioned as a listed company in the US, operating on a level playing field under local regulatory rules,” Buberl says.
The US business, which includes Axa AllianceBernstein, represented around €1.1bn or 19 per cent of Axa’s underlying earnings in 2016, according to Barclays analysts.
“While we regard this as a capital management/portfolio management exercise – and as such positive – some may speculate the action is taken in an effort to build a war chest for potential big M&A,” they said in a note, calling it a surprise announcement.