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Pimco, Allianz Officials Downplay Acquisition Talk

July 09, 1999| From Times Staff and Wire Reports

Officials at U.S. fund manager Pimco Advisors Holdings and German insurance giant Allianz AG confirmed Thursday they had held talks, but played down speculation that the German group was poised to acquire Pimco.

Both companies stressed a linkup was just one of the options they were considering.

"We've been approached over the last few years by a number of potential suitors, and we ain't married yet," said Lee Thomas, a Pimco managing director and chief portfolio manager. "Our view has been that it's better for us not to link to a single entity. We would rather be able to distribute our products widely through a number of entities."

Allianz officials said Newport Beach-based Pimco, one of the leading U.S. fund managers, was not the only financial institution on its potential shopping list.

"We have talked with many, among them with Pimco," the insurer's spokesman said.

Pimco's partnership units, which trade on the New York Stock Exchange, fell $1 Thursday, to $32.88. Allianz shares fell nearly 2%, to $293, on the Frankfurt Stock Exchange.

An acquisition of Pimco could be worth as much as $5 billion, industry experts said Wednesday.

Allianz has made no secret that it was looking for acquisition targets among life insurers and asset management firms in the United States, where it has yet to achieve its strategic goal of ranking among the top five players.

Analysts said Pimco, which manages $250 billion in assets and ranks among the top U.S. fund management firms, would be a good fit for Allianz. Pimco is one of Orange County's premier companies and employs 585 employees here.

Some analysts said the price tag might turn out to be too high for Allianz, which, lacking a U.S. stock listing, would have to pay cash for Pimco.

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