Swiss insurance giant Zurich has sold its Moroccan subsidiary to Allianz – the latest in a series of sales of the company’s global insurance subsidiaries.
This follows Zurich’s decision to sell its general insurance operations in Taiwan to the country’s largest automobile company, Hotai Motor Co, at the end of last week, as it bids to reshape the structure of the company and stem a decline in profitability.
Allianz Group announced in a statement that it has a binding agreement for Allianz to acquire Zurich Assurances Maroc, a subsidiary of Zurich Insurance Company in Morocco.
Zurich Assurances Maroc is one of the largest insurance companies in Morocco, serving more than 600,000 customers. The company also has a license for life and health insurance products, something that Allianz said it plans to utilize.
Sergio Balbinot, board member of Allianz SE in charge of southern and western Europe, Africa, MENA and India at the firm dubbed the deal a “major milestone”. The purchase price is €244m. Pending regulatory approvals, the transaction is expected to close end of 2016.
Presently represented in 15 countries in Africa, Allianz Group said that it views the region as an important future growth market and the acquisition in Morocco, Africa’s second-largest insurance market after South Africa, marks “an important step” for the organisation.
In a bid to rebuild Zurich’s reputation with investors, following large losses and two profit warnings in 2015, as reported, the company is in the process of undergoing cost-cutting and efficiency drive aimed at saving more than US$1bn (£700m, €900m) that will impact around 8,000 of Zurich’s 55,000 employees by the end of 2018.
The move, the first in a series of initiatives being brought in by the insurance company’s recently-appointed chief executive, Mario Greco, saw the company merge its life and general insurance divisions resulting in a number of redundancies at the firm.