AXA looking to buy Fondiaria assets-source

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Wed Feb 22, 2012 8:20pm GMT

* Axa eyeing assets from Fondiaria-Unipol tie-up - sources

* Axa head de Castries declines to comment

* Fondiaria shares up over 6 pct, outperform sector

(Releads, adds detail, sources, shares)

MILAN, Feb 22 (Reuters) - The boss of French insurer Axa and the head of the family controlling Italy's Fondiaria were under the same roof on Wednesday, stoking talk a deal for some of the struggling Italian insurer's assets is in the works.

AXA (AXAF.PA) Chief Executive and Chairman Henri de Castries entered the Milan headquarters of investment bank Mediobanca (MDBI.MI), where loss-making Fondiaria (FOSA.MI) controller Salvatore Ligresti was also present.

In January, Mediobanca got Bologna-based insurer Unipol (UNPI.MI) to agree to buy Fondiaria, though the recent acquisition of an 8 percent stake in the insurer by private equity fund Palladio Finanziaria and Sator, the investment vehicle of banker Matteo Arpe, has cast doubt on that deal. [ID:nL5E8DH3L8]

Sources familiar with the deal have said that AXA, Europe's second-biggest insurer, could be interested in buying assets that might be sold as part of any Fondiaria tie-up with Unipol.

On his way into the Mediobanca building, de Castries declined to comment on a possible interest in Fondiaria assets but confirmed the group was interested in growing in Italy.

Fondiaria shares, which have risen over 150 percent since the deal with Unipol was announced at the end of January, were up 6.4 percent at 1.72 euros at 1510 GMT, while the European insurance sector .SXIP was down 1.1 percent.

Merging Fondiaria, which is Italy's second-biggest motor insurer, with Unipol would create a national insurance group with a 32 percent share of non-life business and 37 percent of the motor sector.

"Going on previous merger deals we've seen in the sector, the antitrust will ask the new group to shed non-life assets," a source close to the deal said.

In December, when concerns about Italy's sovereign debt problems were acute, Mediobanca had sounded out a series of possible foreign suitors for Fondiaria, Axa among them, a second source said, adding none had expressed interest in buying Fondiaria.

"I think they must be about to sign. Otherwise he (de Castries) wouldn't walk into Mediobanca," a London-based trader said.

Fondiaria, which just five years ago had a market capitalisation of 5 billion euros, has withered to about 710 million euros under the management of the Ligresti family owners.

($1 = 0.7539 euros)

(Reporting By Gianluca Semeraro and Stephen Jewkes. Additional reporting by Lionel Laurent in Paris)

((stephen.jewkes@thomsonreuters.com)(+39.0266129695)(Reuters Messaging: stephen.jewkes.thomsonreuters.com@reuters.net)) Keywords: FONDIARIA AXA

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