Allianz sees India fund JV deal within weeks

By Jeffrey Hodgson

HONG KONG (Reuters) - Insurer Allianz SE (ALVG.DE) expects to sign a deal within weeks to set up an asset management joint venture in India, becoming the latest global firm to target its promising but fiercely competitive fund market.

The German firm already operates one Indian joint venture, Bajaj Allianz Life Insurance Co Ltd, in partnership with Bajaj Auto (BAJA.BO), India's No. 2 motorcycle maker. Allianz executive Marna Whittington said last month the firm was in talks with the Bajaj group about also setting up a fund joint venture.

Douglas Eu, chief executive officer, Asia Pacific with Allianz Global Investors, said he could not identify the potential partner for regulatory reasons, but noted the Indian firm would help the venture quickly establish a name in the world's second most populous nation.

"I'm optimistic we will sign a joint venture in the next four weeks," he told Reuters in an interview in Hong Kong.

"Our entry strategy is there to try and minimize the amount of upfront losses that we're going to take and try to minimize the amount of upfront investment in branding."

Ranjit Gupta, an executive with Bajaj Finserv Ltd (BJFS.BO), confirmed the group was in talks with Allianz but said nothing had been decided.

India's 35-member fund industry had about $124 billion in assets under management at the end of July. While the industry has been hit by a near one-third plunge in Indian stocks this year, Boston Consulting Group has forecast assets could more than quadruple by 2015.

Allianz Global Investors, the fund management arm of Europe's largest insurer, had 953 billion euros of assets under management at the end of the first quarter. It controls a stable of fund managers including fixed-income giant PIMCO.