European insurance giants Allianz and Generali could be preparing to sell billions of euros of life insurance assets in order to free up capital amid the COVID-19 pandemic, according to reports from Bloomberg.
Sources told the publication that Allianz has been working with Morgan Stanley to divest as much as €9 billion of assets in countries such as Italy.
The sale would follow Allianz’s review of its European life business outside Germany, and could be worth about €500 million.
Generali, meanwhile, is planning to offload its French life insurance portfolio, sources reported.
The deal, which is being supported by financial services specialist Fenchurch Advisory, could involve between €1 billion and €2 billion of assets, Bloomberg said.
Generali has been considering the sale of a back-book portfolio linked to savings products in its life insurance unit for some time approached several banks over the deal back in January.
The market for back books has been growing steadily over the past few years, and analysts feel that deal activity in the life sector has proven resilient to the impact of the coronavirus crisis.
By pursuing a divestment, Allianz and Generali could therefore get the attention of specialist consolidators, sources suggested.