Pimco Doesn’t Need Another German Stablemate
The only reason to push for a tieup between DWS and Allianz is the misguided hope that they need each other.
DWS may look cheap. That doesn’t mean Allianz should buy it.
Photographer: Alex Kraus/BloombergSo it looks like the shotgun wedding between Deutsche Bank AG and Commerzbank AG is finally limping to the altar. To fund its dowry of as much as 8 billion euros ($9 billion), Deutsche Bank may sell its remaining stake in DWS Group to Allianz SE, according to my colleagues at Bloomberg News. So the seller’s motivation is obvious; less clear are the reasons why the German insurer might want to get involved in the forthcoming M&A circus.
In March, Deutsche Bank raised about 1.4 billion euros by selling a 22.25 percent stake in DWS, whose total market capitalization is currently about 6 billion euros. Add in a standard 30 percent takeover premium, and Allianz would be looking at finding almost 8 billion euros – less than 10 percent of its own market value – to get a deal done.