UniCredit Seeks Better Terms on Amundi Distribution Deal

(Bloomberg) -- UniCredit SpA is seeking to renegotiate a five-year-old deal with Amundi SA to distribute asset management products, in a further sign of Chief Executive Officer Andrea Orcel’s drive to reshape Italy’s second-largest lender. 

Orcel aims to improve the terms of an accord stemming from the purchase by the French asset manager of UniCredit’s Pioneer Global Asset Management unit that’s due to run until 2026, according to people with knowledge of the matter. 

The current deal commits UniCredit to a level of guaranteed sales to its wealthy customers that the bank regards as too high, the people said, asking to not be named because the matter is private. While formal talks haven’t started yet, UniCredit intends to approach the French firm to discuss the deal, they said. 

As of today, there is no renegotiation of the deal, a spokesperson for Amundi said. A spokesman for UniCredit declined to comment.

UniCredit and Amundi signed a 10-year distribution agreement in 2016 when Orcel’s predecessor Jean Pierre Mustier sold Pioneer to Credit Agricole SA’s Amundi for 3.5 billion euros ($4.1 billion). That was part of an effort to raise capital and trim businesses with limited prospects. 

Amundi shares fell as much as 0.4% after the news, trading at 79.85 euros as of 1:29 p.m. in Paris. 

Mustier Legacy

While a termination of the agreement before its expiration would cost UniCredit a one-off penalty, it would have consequences for Amundi’s business in the country which relies heavily on the Italian lender.

Orcel, who took the helm April 15, is reviewing the business and laying out a growth strategy after doubts over the bank’s direction led to Mustier’s exit. The executive, who is working on a new business plan that will be announced before the end of the year, said in May that his aim is to move UniCredit away from restructuring, to delivering sustainable returns. 

The Amundi business would not be the first Mustier legacy that Orcel has sought to overturn. The ex-UBS Group AG banker has slimmed down management ranks and cut back on the co-head structures that were formed under the previous leadership, and has ended a signature policy of selling off works of art held by the bank. 

Since taking over, Orcel has led the bank into negotiations with the Italian government over the acquisition of troubled lender Banca Monte dei Paschi di Siena SpA. He also angered some investors in May when UniCredit decided not to pay a debt coupon on about 30 million euros on technical grounds. 

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