In line with its P&C-focused strategy, Sampo plc announced a strategic review of Mandatum’s role within the group on December 7th, 2022. After assessment of options, the Board resolved to propose a demerger of Sampo to separate Mandatum.
At the Annual General Meeting, held May 17th, 2023, it was resolved to approve the partial demerger of Sampo as set forth in the plan approved and signed by the Board of Directors in March earlier this year.
Sampo hence would become a pure-play property and casualty (P&C) insurer with an attractive footprint and the potential to deliver high and resilient returns on capital. The demerger advances Sampo’s strategy, emphasising a preeminent focus on P&C insurance operations.
In the demerger, all of the shares in Mandatum Holding Ltd and related assets and liabilities will transfer without a liquidation procedure to Mandatum plc, a company to be incorporated in the demerger. While an independent Mandatum would be able to build on its strong Finnish core business to enhance growth.
Mandatum will have greater strategic and financial flexibility on a standalone basis, allowing it to continue implementing its current growth strategy focusing on fee-generative products and run-off of its with-profit book.
As part of the resolution on the demerger of Sampo and conditional upon the registration of the completion of the demerger, the AGM resolved to establish a new entity, Mandatum plc, to approve its articles of association.
Additionally, the company will elect Markus Aho, Jannica Fagerholm, Kimmo Laaksonen, Johanna Lamminen, Patrick Lapveteläinen and Jukka Ruuska to Mandatum plc’s Board of Directors. It is being proposed that said Board of Directors elect from among themselves Patrick Lapveteläinen as the Chair and Jannica Fagerholm as the Vice Chair of the Board of Directors.
The AGM also resolved to, until the close of the first AGM of Mandatum pay a term fee of €27,000 to each member of the Board of Directors, €42,000 to the Chair of the Board of Directors and €36,000 to the Vice Chair of the Board of Directors. The company will also pay meeting fees for each meeting of the Board of Directors of €600 for each member of the Board of Directors and €1,500 for the Chair of the Board of Directors and the Vice Chair of the Board should she chair the meeting while paying meeting fees for each meeting of the Audit Committee of €600 for each member of the Audit Committee and €1,000 for the Chair of the Audit Committee.
Following the demerger, Sampo would become the largest P&C company in the Nordic market with a 20% market share. Gross written premiums for Sampo for the financial year 2022 stood at €8.1 billion, with a combined ratio of 82.1%. While its underwriting profit stood at €1.3 billion for 2022 and the underwriting profit growth was 13%.
