Zurich Insurance is acquiring an 80% stake in Indonesia’s Adira Insurance from PT Bank Danamon Indonesia and a minority investor for about $414m.
“Zurich has earmarked Asia Pacific to be a major engine of growth for the group, and Indonesia is a key market for us. Today’s transaction demonstrates our commitment to Indonesia,” Zurich’s Asia Pacific head, Jack Howell, said in a statement.
The deal should be finalised in the next six months and includes two separate long-term strategic cooperation agreements with Bank Danamon, Indonesia’s fifth-largest bank by market capitalization, and with Adira Finance, the country’s second-largest motorcycle and auto financing solutions provider.
The total transaction amounts to approximately $414m, with potential future incremental payments subject to business performance. With this acquisition, the Swiss group will become the largest foreign P&C insurer in Indonesia.
“Indonesia is one of the world’s most attractive insurance markets. It is Southeast Asia’s largest economy with a strong growth trajectory and a rapidly expanding middle class. These factors, coupled with low levels of insurance penetration, present significant upside potential for the insurance market,” Zurich said in a statement.
Established in 1996, Adira Insurance generated gross written premiums of $158m last year. Adira is said to have a leading market position in motor and takaful insurance – sharia compliant – in Indonesia.