French insurance company AXA has entered into a deal to sell its operations in Poland, Czech Republic and Slovakia to UNIQA Insurance Group for €1bn.
Under the terms of the agreement with UNIQA, AXA will sell 100% of its Life & Savings, Property & Casualty and Pension businesses in Central and Eastern Europe. The purchase price of €1.002bn represents an implied 12.4x 2019E P/E multiple, and is expected to boost AXA's Solvency II ratio by 2 points.
AXA CEO Thomas Buberl said: "This transaction marks another step in the simplification of AXA's footprint, we are convinced that AXA's operations in Central and Eastern Europe will benefit from UNIQA's strong presence and local expertise in the region to create new growth opportunities with a continued focus on delivering enhanced customer value propositions."
This transaction marks another step in the simplification of AXA’s footprint"
The insurer is quitting markets where it lacks scale as part of a deep restructuring to cope with a negative interest rate environment.
AXA Poland employs 1,575 people. It provides a range of life and savings (L&S), property and casualty (P&C), pension, and asset management products and solutions to nearly 3.2 million customers. AXA Czech Republic and Slovakia offers a product suite of L&S, P&C and Pension solutions to approximately 1.6 million retail customers through its 527 staff.
Uniqa said in a separate statement it planned to finance the acquisition via borrowing rather than a capital increase.
Completion of the transaction is expected to be finalised by the fourth quarter of 2020, once necessary closing conditions and regulatory approvals have been met.