Italian lender Unicredit has announced the cancellation of an agreement reached in November with Spain’s Santander to create a new asset management company by combining their respective subsidiaries Pioneer Investments and Santander Asset Management.
Italy’s biggest bank by market capitalisation said in a statement: “Both parties have been involved in in-depth discussions to come up with feasible solutions which would satisfy all the regulatory requirements needed to seal the transaction.”
However, “in the absence of a solution which could be implemented in a reasonable time period,” the parties “have finally decided that it would be better to end the talks.”
Rumours regarding the break-up of the project started in the wake of the Brexit referendum on June 23, when the UK decided to leave the European Union. Brexit is a blow for financial industry players with HQ in the City, as is the case of Pioneer Investments and Santander Asset Management.
The termination of the agreement between the Italian and Spanish banks also coincides with the recent arrival of a new CEO at Unicredit, Frenchman Jean-Pierre Mustier. Former top executive, Federico Ghizzoni, headed up the merger talks but he was ousted in April.
The tie-up agreement between Santander and Unicredit’s asset management companies was going to create a new European giant, with about 400 billion euros of assets under management. The project was first announced in April 2015 and was approved by the European Commission in May of this year.
*Image: Foter/ Gonmi