Global insurer Allianz has agreed to acquire automobile and other property and casualty (P&C) operations from Brazilian insurer SulAmérica in a deal valued at BRL 3 billion (€667 million).
The transaction is expected to significantly expand Allianz’s presence in Brazil, making it one of the top three insurers with a market share of around 15% in motor and 9% in P&C.
This will also result in Allianz ranking as the number 2 automobile insurer in the country.
Total premium income from the acquired entity added up to €806 million euros in 2018, with €762 million stemming from motor and €45 million stemming from other P&C operations.
The premium income of the combined entity, meanwhile, is €1.5 billion with €1.2 billion related to motor business.
Allianz noted that the P&C market in Brazil is currently very attractive, with a premium volume of approximately €16 billion and a growth rate of 6.0% in 2018 alone.
The acquisition from SulAmérica will also allow the insurer to further invest in digital and disruptive technologies, it added, while enlarging its service offering for customers.
“With the acquisition of SulAmérica’s Property-Casualty operations, we have taken another major step in the strategic repositioning of our Latin American insurance businesses,” says Oliver Bäte, Chief Executive Officer (CEO) of Allianz SE.
“We are attaining a clear leadership position to effectively compete in the growing Property-Casualty market of the largest economy in South America,” Bäte explained.
Eduard Folch Rue, CEO of Allianz Seguros S.A. (Allianz Brasil), also commented: “We are creating a new Allianz combining the best people of both sides and forming an outstanding team that will embrace the opportunities of the Brazilian market with full commitment and confidence.”
“Our trademark will be the innovation, digitalization, and the service to our customers through our main partners, the brokers and advisors,” he continued. “We will combine the local know-how of SulAmérica with all the strengths that an international Group like Allianz has.”
The transaction is scheduled to be completed within the next 12 months, pending regulatory approvals.
Allianz Brasil is currently active in both P&C and health insurance, operating through more than 1,000 employees, 48 branches, and approximately 15,000 insurance brokers across the nation.