Portuguese bank Novo Banco has completed the sale of its life insurance business GNB Companhia de Seguros de Vida (GNB Vida) to Apax Partners' GBIG Portugal for €168m.
As part of the agreement, Novo Banco will continue distributing GNB Vida's life insurance products in the Portuguese market for a period of 20 years.
Novo Banco said in a statement sent to the Portuguese National Securities Market Commission (CMVM): "The sale price was set at an initial fixed price of €123m plus a variable component of up to €125m tied to sales targets in the Novo Banco-GNB Vida product distribution agreement Portugal completed.
We believe that the combination of Novo Banco’s strong franchise and market position, together with our focus on new products and solutions, will bring substantial benefits to Novo Banco’s 1.3 million customers.”
"The lump sum declared on 12 September 2018 was EUR 190 million, with a final amount of EUR 168 million on a comparable basis."
The Portuguese bank also said that the transaction, which will have a positive impact on its Common Equity Tier 1 capital of €6m, represents a significant step towards its divestment strategy of non-strategic assets, which also implies a greater focus on banking operations.
FROM GNB VIDA TO GAMA LIFE
GNB Vida has been renamed Gama Life following its acquisition by GBIG Portugal.
"GamaLife, a new European life and wealth consolidation platform, launches today with the acquisition of GNB Vida from Novo Banco Group in Portugal," said Apax Funds in a note on 14 of October.
GamaLife, backed by funds advised by Apax Partners, intends to build on its acquisition of GNB Vida as the start of a wider consolidation strategy in the life insurance market, continues the note.
Matteo Castelvetri, Group CEO, outlined: "We are excited to launch GamaLife and believe Apax are an excellent partner to help us create an innovating pan-European life and wealth platform.
"We are delighted to complete our first acquisition in GNB Vida and enter the fast-growing Portuguese market.
"We believe that the combination of Novo Banco's strong franchise and market position, together with our focus on new products and solutions, will bring substantial benefits to Novo Banco's 1.3 million customers."
Frank Ehmer, Partner at Apax Partners, added: "We have been proactively targeting the life insurance and wealth management markets for a number of years. We are excited to back Matteo and his team to grow the GamaLife platform, both organically and through further consolidation of the European market. In doing so, we are pleased to have the opportunity to help cement GNB Vida's position as a market-leading life insurance partner for Novo Banco."