Hannover Re parent Talanx has agreed to acquire Generali's majority stake in its Columbian operations as the Italian insurance giant continues to divest non-core businesses.
The deal, valued at EUR30mn, will see Talanx purchase more than 90 percent of Generali Colombia's general and life insurance businesses, Generali Colombia Seguros Generales S.A. and Generali Colombia Vida Compañia de Seguros S.A, as the German insurer looks to strengthen its Latin American presence.
The acquired companies include eight branch offices in Colombia and headquarters in Bogota.
Combined, Generali said that the two units wrote gross premiums of EUR59mn and produced an EBIT of around EUR2mn in 2016.
Around 70 percent of the portfolio relates to the property insurance business, with the remainder focussed on life.
The acquisition is subject to approval by the Colombian regulatory authority and is expected to close by the end of the year.
Talanx said that it already has a presence in six Latin American countries through the HDI brand, with the carrier reporting gross premium income of EUR1.5bn and EBIT of EUR77mn in the target region last year.
Torsten Leue, a member and chairman of the board of management at Talanx International, said: “For Talanx, the acquisition of Generali Colombia is a strategic step to open up the fifth largest Latin American market. For us, this means further strengthening our position in the target region.”
The company added that the new companies will also help it write industrial lines business in Columbia from a “fronting perspective”.
The news comes after Reuters reported in March that Generali had put three of its Latin American subsidiaries up for sale, with the insurer appointing investment bank Rothschild to sell its Colombian, Ecuadorian and Panamanian subsidiaries.