Allianz announces share purchase agreements to acquire 72 percent of European Reliance
Allianz SE today announced it is entering into certain Share Purchase Agreements (“SPAs”) to acquire 72 percent of European Reliance General Insurance Company SA (“European Reliance”), a leading Greek insurer with 223 million euros in gross written premiums (GWP), with a network of 110 retail offices and 5,667 agents. The transaction is the continuation of Allianz Group’s stated strategy to grow its franchise by leveraging its scale and expertise.
Allianz will pay 7.80 euros per share1 or approximately 207 million euros to acquire all the outstanding shares of European Reliance via the SPAs and a combined Voluntary Tender Offer (VTO).
Following the approval by the Bank of Greece, the Hellenic Competition Commission and the Hellenic Capital Market Commission, Allianz intends to publish the approved Information Circular and proceed with the VTO for the shares in European Reliance at the same price. The shareholders can then tender their shares within the VTO acceptance period.
1 Independent Valuation Report Allianz commissioned
1 Announcement of Submission of a Voluntary Tender Offer
Unique Growth Opportunity
European Reliance, once combined with Allianz Hellas, would become the first in Property-Casualty insurance, the fifth largest insurance company in Greece based on GWP and the fifth largest Life/Health insurer2, empowering the company to pursue further growth in the Greek market and expand through new product offerings, distribution channels and customer pools. Once the transaction is completed, European Reliance’s CEO Christos Georgakopoulos will assume the role of CEO of the combined company.
“This is an exciting opportunity for Allianz to elevate its position in the attractive Greek insurance market with an ideal entity such as European Reliance,” said Sergio Balbinot, Member of the Board of Management of Allianz SE. “I look forward to welcoming European Reliance’s employees to the Allianz Group after all the regulatory clearances are granted. Together, we will have deep sector knowledge and be well-placed for success.”
2 Sources: 2020 SFCR Reports and competitor public data. Pro-forma for Generali Group/AXA Insurance and NN Group/MetLife M&A announcements.
Key Investment in Greece
The acquisition of European Reliance, the largest independent insurance undertaking in Greece, represents Allianz’s deep commitment to the Greek market. As a subsidiary of a global leader, the combined entity would benefit from Allianz’s proven knowledge and financial strength.
European Reliance – Strong Profitability and GWP Increase in the 9-month period of 2020
Significant increase of the Company’s Financial Figures in a volatile environment, according to the published summarized financial figures of the 9-month period of 2020.
More specifically, European Reliance presented:
4% strong growth of profitability, with pre-tax Profit at € 18.8 mil., comparing to € 12.5 mil. in the respective period of 2019.
1% increase of Gross Written Premiums and related income at € 158.8 mil., versus € 151.1 mil. in the respective period of 2019.
8% Total Equity increase at € 144.6 mil., comparing to € 142.1 mil. in the end of 2019.
Strengthening of the Solvency Capital Requirement Ratio by 8.5 percentage points with SCR at 176.1%, comparing to 167.6% on 31/12/2019.
Total number of Employees increased at 448, comparing to 442 employees in September 2019.
It is worth noting that, according to the Company’s Management estimations, the up-to-date data show that the key financial figures of the Company for H2 2020, will not be affected significantly due to the Covid-19. On the contrary, it is expected a Total Equity Increase and an additional increase of the Solvency Capital Requirement Ratio of the Company, provided that the National Authorities will not announce a full lockdown by 31/12/2020.
The Management of the Company observes closely the ongoing pandemic phenomenon, to be able to apply all measures immediately and protect the health and interests of the Shareholders, Employees, Insurance Agents and Customers.