Trieste, Italy-based Generali Group has agreed to sell its Belgian business to Bermuda-based Athora Holding for €540m.
The transaction will generate a capital gain of about €150m and is expected to add some 2.6 percentage points to Generali’s Regulatory Solvency II ratio, according to a statement issued by the company.
The deal, which is subject to regulatory approvals, is expected to close in the second half of the year.
The Generali Belgium is reported to have contributed €22m to the parent company’s net result in 2017.
The Generali Group will retain a presence in Belgium, where it will continue to provide insurance and assistance services through its Global Business Lines operations, as well as through its European Assistance operations, the company said.
Athora Holding spun off
As reported, Athora Holding was created in January, when Ager Bermuda Holding Ltd – which had acquired Dublin-based Aegon Ireland plc five months earlier – was spun off by its Bermuda-based parent, Athene Holding Ltd, and rebranded as Athora.
Like its predecessor Ager Bermuda, Athora is a specialist in the European life run-off market, which it operates as a holding company of a network of subsidiaries. Its business involves offering insurance companies a facility for monetising their legacy portfolios, in such a way that these companies’ policyholders’ needs are properly looked after, according to the company.
In announcing the spin-off and re-branding in January, Athene said that the Athora holding company would remain in Bermuda, but its main administrative offices would be located in London, with major outposts in Wiesbaden, Germany and Dublin.
Earlier this month, the London-based Life Company Consolidation Group (LCCG), which as its name implies also specialises in consolidating the businesses of existing life insurance companies, announced it was to acquire the international investment bond business of Aegon Ireland from Athora Holding.
This came some four months after LCCG – which in 2016 acquired AXA Isle of Man and rebranded it as Utmost Wealth Solutions – announced, in December, it was to acquire Ireland-based Generali PanEurope.
‘Optimise its geographical footprint’
Like a number of other insurance companies that have recently sold off, or announced plans to sell, regional businesses, Generali said it was shedding its Belgian business in order to make the most efficient use of its existing operations elsewhere.
“The transaction is part of the Group’s overall strategy to optimise its geographical footprint and to improve its operational efficiency and capital allocation,” the company said, in its statement announcing the sale.
Group chief executive of Generali’s Global Business Lines & International Frédéric de Courtois added that, in the wake of having announced plans to sell operations in Guatemala, Panama, Colombia, the Netherlands and Ireland, “this transaction represents yet another important step ahead” in the company’s strategy to streamline its operations and boost its efficiency.