Germany's DWS eyes Indian AIF space, to pick up 40 pc stake in NIAIF

Mumbai, Nov 13 (PTI) Germany's DWS Group on Thursday announced that it is picking up a 40 per cent stake in Nippon Life India Asset Management's (NAMI) alternatives business for an undisclosed sum.

The Frankfurt-headquartered DWS Group, which is majority owned by Deutsche Bank and manages USD 1.22 trillion in assets globally, has entered into a memorandum of understanding with NAMI for the stake buy and forming a proposed joint venture in the alternatives space, as per a statement.

"DWS plans to invest in Nippon Life India AIF Management (NIAIF) to further scale up the alternatives business of Nippon India," the statement said.

The entity is likely to issue new shares which will take DWS' stake to 40 per cent.

The 10-year-old NIAIF is in early stages of growth and has so far raised USD 1 billion of capital commitments for various AIFs, and has built a product suite across private credit, listed equities, real estate and venture capital categories, it said.

"With the proposed JV it plans to further expand its product suite and expand its coverage to offshore investors through DWS' global reach," the statement added.

The envisaged investment must be seen as DWS' confidence in the structural growth of India's alternative-markets ecosystem and the strong track record of Nippon India in managing alternative strategies, it said.

"India is one of the core growth markets for global asset managers for the next decades and has long been a strategic ambition for DWS," DWS Chief Executive Stefan Hoops said.

From its India introduction in 2012, AIFs have raised Euro 148 billion in gross capital commitments so far, and the same is expected to reach Euro 600 billion in the next five years on the back of a 32 per cent compounded annual growth, the statement said.

DWS and NAMI are looking to establish "a strategic cooperation" to jointly launch passive products for the Indian and for Europe's UCITS markets, leveraging each, and have a global distribution arrangement to develop and distribute actively managed mutual funds with India-focused strategies through DWS' global distribution network.

NAMI's Chief Executive Sundeep Sikka said alternatives is the next big opportunity in India's asset management landscape and the two partners aim to build a strong and scalable alternatives business that attracts both domestic and international investors.

Deutsche Bank's Chief Executive for India and Emerging Asia, Kaushik Shaparia said the German entity is not only investing in a market of immense potential, but also reiterating its confidence in India's regulatory framework, its entrepreneurial spirit. PTI AA TRB