At long last the race for the top spots in Germany's (and possibly Europe's) financial services business can begin in earnest.
By David Schutt
May 2001
Institutional Investor Magazine
Giant insurer Allianz Group's announcement (see "After Allianz") April 1 that it would take over Dresdner Bank and transfer its stake in HypoVereinsbank to the world's largest reinsurer, Munich Reinsurance Co., will likely jump-start a long-awaited series of banking mergers, acquisitions, spin-offs and joint ventures in Germany and beyond.
Already, speculation has begun about what the next deal will be and who's got the inside track. As German banks and insurers are freed from their restrictive arrangement of cross-shareholding agreements, they should be able to define their growth strategies more precisely and pursue them more aggressively, both inside and outside of Europe's biggest economy. Previously, maintaining relationships with these significant shareholders, which might also own a big chunk of one or more of the firms' competitors, could consume a good deal of time and effort.
Institutional Investor Senior Contributing Editor Joan Warner was already at work on a profile of HypoVereinsbank and its CEO Albrecht Schmidt (see "Bold Blueprint for a Eurobank") when news of the Allianz-Dresdner deal broke. Unlike his fellow CEOs at rivals Deutsche Bank, Commerzbank and Dresdner, Schmidt is steering clear of high-profile investment banking and instead trying to build a "European bank of the regions." His institution will focus on real estate lending, retail financial services and middle-market corporate finance. "With a cleaner management structure, Schmidt is freer to pursue his contrarian vision," says Warner, a former senior news editor for Europe at BusinessWeek.
A race of a different sort has begun in Italy, where Tiscali founder and chairman Renato Soru is rushing to realize his goal of making his company Europe's dominant Internet service provider. It's easy to bet against Soru, since he's an independent taking on deep-pocket giants like Deutsche Telekom. But, as Staff Writer David Lanchner notes ("Sprinting a Marathon") Ted Turner was once a struggling outsider, too. Just days after Lanchner interviewed Soru in Milan, Tiscali reeled in three acquisitions that now make it, by some measures, Europe's biggest ISP.
Although we can't say for sure where in the pack Schmidt or Soru will finish, we can tell you definitively who Asia's best equity analysts are: Our Asia Research Team results begin on page 85.
