Allianz Criticizes Bank Mishandling of Block Sales

By Marc Castro

Apr 04, 2013 01:17 AM EDT

Allianz Global Investors is the fund management unit of Allianz SE, Europe's largest insurer. It has criticized investment banks for its mishandling of shares sales and has vowed to withdraw participation in future block sales. The information was made known through a letter obtained by Bloomberg News.

According to Neil Dwane, Allianz's Chief Investment Office for Europe, "I am writing to express our growing frustration and investment anger at the way in which many equity placings are being handled or more directly, mishandled. We have tolerated this as much as we can."

This complaint stems from the occurrence that banks retain holdings in companies after it fails to find a purchaser for the shareholdings. This can weigh heavily on share values and result in investor losses. Amongst those highlighted are Barclays Plc retaining stake in Ziggo NV after it managed share sales for Warburg Pincus and Cinven Ltd, owners of the company.

Dwane further highlighted the 'excessive competition' by and between banks to win accounts and take credit for block sales as well as the lack of communication between them, exacerbating the issue.

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