By William Louch 

This article is being republished as part of our daily reproduction of articles that also appeared in the U.S. print edition of The Wall Street Journal (August 7, 2020).

U.K. private-equity firm Cinven's planned purchase of a unit of French insurance company AXA SA has collapsed, the latest example of how the coronavirus pandemic has stymied deal making.

AXA said Thursday that an agreement it struck to sell its AXA Life Europe business to Cinven had been terminated after failing to meet certain conditions.

A source close to the deal said that the two parties were unable to bridge the gap between their expectations on the unit's valuation, particularly after the Covid-19 pandemic hit.

The announcement ends negotiations that date back to Aug. 1, 2018, when AXA disclosed it had received an offer from Cinven for the unit. The private-equity firm initially agreed to pay EUR925 million ($1.01 billion)) for shares in AXA Life Europe with a subsequent distribution of EUR240 million by the unit to AXA before the deal closed.

AXA Life Europe is a specialized platform that designs, manufactures and distributes AXA's variable annuity products across Europe.

The transaction's demise is the latest example of how the pandemic has hampered private-equity deal making across the globe. Private-equity firms world-wide announced $180 billion in acquisitions in the first half, 36% less than the first half of 2019, according to a report released late last month by Ernst & Young Global Ltd.

Activity has been depressed by several factors, including a lack of debt financing and a mismatch in pricing expectations between buyers and sellers.

A handful of deals that had already been agreed to have been canceled or renegotiated at lower prices. In May, U.S. private-equity firm Sycamore Partners and Victoria's Secret owner L Brands Inc. agreed to scrap a deal for the lingerie retailer.

Last month, meanwhile, cybersecurity company Forescout Technologies Inc. agreed to a revised deal with private-equity firm Advent International Corp. at a price that was around 12% lower than the $33 a share Advent originally said it would pay in February.

AXA said in a statement Thursday that it is continuing to review strategic options with regard to the AXA Life Europe unit it had agreed to sell to Cinven.

The Paris-based company, one of Europe's largest insurance groups, saw earnings fall by 48% to EUR1.9 billion through the first six months, with the fall driven largely by claims related to the pandemic.

Cinven is one of Europe's best-known private-equity groups and is currently investing from a EUR10 billion fund that it closed last year. Last week, the firm announced it had completed its EUR17.2 billion acquisition of Thyssenkrupp AG's elevator division, which it bought as part of a consortium that included Advent.

Write to William Louch at


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August 07, 2020 02:47 ET (06:47 GMT)

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