Pioneer Investments and Santander Asset Management (SAM) have confirmed their merger to create a €400bn asset manager, with UniCredit keeping the US operations out of an arrangement with the Spanish bank.

Banco Santander, jointly with private equity partners Warburg Pincus and General Atlantic, owned SAM prior to the merger with Pioneer, which was owned by Italian bank UniCredit.

The trio has created a new legal structure with a holding company called Pioneer Investments – owned 50% by UniCredit and 50% by the private equity firms.

This holding company owns 100% of Pioneer’s US operations and 66% of the merged ex US operations of Pioneer and SAM.

The remaining third belongs to Banco Santander, meaning the Spanish bank has no legal involvement in the US business.

Current chief executive of SAM, Juan Alcaraz, will become the global head of the new holding company, with Pioneer Investments chief executive Giordano Lombardo becoming global CIO.

Pioneer said the new combined company would manage around €400bn, with the merger creating “substantial” economies of scale while expanding investment strategies and distribution channels.

The arrangement values Pioneer Investments at €2.75bn and SAM at €2.6bn.

It will also boost UniCredit’s capital position by 25 basis points.

Earlier this week, UniCredit chief executive Federico Ghizzoni confirmed reports the firms were days away from signing the agreement.

The Italian bank had been looking to sell its asset management business for some time before announcing in September that it would enter exclusive discussions with Banco Santander and the private equity firms over a merger with SAM.

Pioneer’s former chief executive Sandro Pierri left the company at the end of January and was replaced by Lombardo.

Pierri spent 11 years at the firm and two and half as chief executive before standing down as merger talks continued.