Allianz Looks to Increase PE investment

Europe’s biggest insurance company, Allianz, may increase its current level of buyout fund investments by as much as €15bn from its own balance sheet in the next few years.

Private equity investments currently stand at around €7bn. The boost to Allianz’s private equity portfolio is part of a wider build up of alternative investments, with more capital also potentially flowing into real estate, renewable energy and infrastructure, said board member Paul Achleitner during a general press briefing held in Munich on 15 January.

Achleitner stressed that the amount to be invested will very much depend on the potential profitability of investment opportunities. The insurance company declined to comment on further details with regards to allocation of its private equity assets.

Allianz is one of the world’s largest asset managers, with third-party assets of €703bn under management at year end 2008. At the end of July, the insurer made the decision to merge its fund-of-funds business, Allianz Private Equity Partners, and its alternative asset business, Alternative Assets Holding, into its direct investment business, Allianz Capital Partners, which will continue to operate under that name.

Allianz Capital Partners has offices in Munich, New York and Singapore. The group expects significant opportunities over the coming years to arise for investments in private equity, infrastructure, and renewable energies, but also for mezzanine financing opportunities.

Former CEO of Allianz Alternative Assets Holding Karl Ralf Jung has become CEO of Allianz Capital Partners. Thomas Pütter, former CEO of Allianz Capital Partners and managing director of Allianz Alternative Assets Holding, is focusing on portfolio investments at Allianz Capital Partners, in addition to being chairman of the advisory board and investment committee based in London.

Since 1998, the direct investment arm of Allianz Capital Partners has grown to a 40-strong team and made over 20 investments with a total volume in excess of €2bn in companies in a wide range of European industries. Of these, 17 investments have been realised to date. The business has generated average annual portfolio returns for Allianz of approximately 30% from buyout activities, and of approximately 20% from mezzanine financing.

Companies in the portfolio include provider of TV and film services Euro Media Group; manufacturer of printing systems manroland; ferry company Scandlines and vending services company Selecta Group.