Following four months of negotiations, an agreement was reached for Allianz X to invest up to $300 million in AlTi Tiedemann Global, a leading independent global wealth and alternatives manager. The result creates a pivotal opportunity for Allianz in the wealth and alternatives management sector. In this Q&A interview, Allianz X staff involved in the complex deal unpack the intricate details of it, the unique value proposition of AlTi, and the strategic rational behind it all.
“Allianz X brings capital and skills to our portfolio companies to foster innovation, fuel growth and realize their ambitions. Our investment in AlTi demonstrates our approach as well as our conviction in wealth management and alternatives, and we believe it will unlock opportunities for scale, new revenue streams, and societal impact for the Allianz Group,” said Allianz X CEO Dr. Nazim Cetin.
What is AlTi Tiedemann Global?
Alexander De Kegel: AlTi is a leading independent global wealth and alternatives manager with combined assets of approximately $68 billion. It provides a comprehensive range of customized services to an ultra-high-net-worth clientele, including entrepreneurs, foundations, multi-generational families, and emerging next-generation leaders. These services include estate planning, fiduciary administration, impact investing, investment advisory, and philanthropy. Unique in its field, AlTi deftly combines the extensive services typical of large firms with the personalized care characteristic of a boutique.
Why has AlTi captured our interest?
Michael Bradt: Our interest stems from our position at the intersection of financial services and technology. Our ongoing analysis pinpoints opportunities for collaboration with promising growth businesses to enhance their competitive advantage and generate financial and strategic returns for Allianz. We have developed a strong hypothesis in the global wealth domain. Wealth management, which offers access to an attractive pool of recurring revenues and is complementary to insurance and asset management, aligns well with Allianz’s overall mission to secure the future of our clients and their families.
What distinguishes AlTi from others in the industry?
Niklas Mundorf: AlTi serves ultra-high-net-worth (UHNW) clients, a focus it has honed over two decades. Its global presence matches the international requirements of its clients and their families, which provides it with a distinct advantage compared to many regional competitors. AlTi’s open architecture means solutions can be optimally tailored to each client’s needs. The company also has its own strategic alternatives business and access to many others. This ensures clients access to the most fitting and effective investment opportunities to meet their goals. The team at AlTi provides an incredible client experience. But don’t take our word for it; their client retention rate has been 97% since 2019, a clear indicator of the company’s distinction in the field.
What’s in it for AlTi?
Philip Wieland: As active investors, we are committed to supporting our portfolio companies throughout their growth journey, assisting them to achieve their milestones and emerge as leaders in their fields. A key aspect of our strategy involves leveraging opportunities within the Allianz universe to enhance AlTi’s business. We see tremendous potential in this partnership, and are eager to demonstrate this in the coming months and years.
Why another North American investment?
Maya Rollinger: This investment transcends geographical boundaries by targeting the global wealth sector. Although AlTi’s headquarters are in New York, their clients, operations, and teams have broad international reach, spanning Asia, Europe, and North America. Our investment accelerates AlTi’s strategy to become the leading global independent wealth and alternatives manager by enabling it to execute on its global mergers and acquisitions pipeline and expand its business in both existing and new markets.
What makes the wealth sector attractive?
Johann Kraberger: Many things. From a macro perspective, the increasing complexity and rapid change in global markets are driving a rising demand for expert private wealth management. The sector benefits from the accumulation and intergenerational transfer of wealth, contributing to steady market growth. From an investor’s perspective, wealth management is capital-efficient, offering substantial margins and dependable revenue streams. A critical feature of this sector is the profound, trust-based relationships between clients and their advisors, leading to exceptional retention rates as well as the creation of long-term partnerships and mutual value.
Sümer Uysal: From a strategic standpoint, Allianz, being one of the world’s largest asset managers with approximately $1.8 trillion in third-party assets under management, possesses extensive expertise in institutional money management. Wealth management introduces a pivotal link between institutional asset management and private wealth, which provides Allianz with exposure to a new market segment. It also offers AlTi the chance to capitalize on the capabilities, infrastructure, and scale of one of the world’s premier asset managers and insurance providers.
How does AlTi fit into Allianz X’s portfolio?
Alex: AlTi’s addition represents a strategic expansion of our portfolio. After thorough team deliberations on diversifying our presence into new, competitive areas, investing in AlTi emerged as a key move to prove our investment thesis in the wealth sector. This further enriches our portfolio of high-conviction investments and takes the total value of assets managed from the North American office beyond the one-billion-dollar mark.
How is the investment structured?
Gregor Freilinger: The investment is planned to be up to $300 million allocated across common and preferred equity, comprising an initial $250 million with an option for an additional $50 million. This is anticipated to potentially lead to a voting stake of up to 24.9%. Beyond the financial aspects, our engagement with AlTi will be formalized by nominating two members to its Board of Directors, facilitating strategic partnership and guidance.
When will the investment “close”?
Philip: We signed the transaction on the 22nd of February 2024 and are currently undertaking all necessary steps to secure the required regulatory approvals. This is a marathon, not a sprint.
What’s next?
Maya: We are looking forward to working closely with AlTi in the future. The investment is just the first step of our journey together. With our recently opened office in New York, we are best positioned to jointly unlock opportunities for both AlTi and the Allianz Group.
