Italy's Generali and France's BPCE said on Tuesday they had taken the first step towards creating Europe's largest asset manager by revenue as the industry bets on size to protect profit margins. The

Assicurazioni Generali SpA and Natixis SA are close to a deal for a joint venture in asset management to cut costs and team up on distribution, according to people familiar with the matter.

The combined entity will have equal ownership, with each party holding 50% and sharing governance and control.

Generali and France's BPCE said on Tuesday they had signed a non-binding memorandum of understanding (MoU) to combine their asset management operations aiming to create Europe's largest player by revenues.

With €1.9tn in AUM, the joint venture would allow the pair to expand globally and speed up a push into private markets.