AXA has agreed to acquire a 50% stake it previously didn’t own in AXA Tianping Property & Casualty Insurance for RMB4.6bn (€584m) from the current domestic shareholders of the Chinese insurance firm.
Image: AXA Tianping to be fully owned by AXA. Photo: Courtesy of Kokky92/Wikipedia.org
AXA Tianping, which is based in Shanghai, has 25 branches and 93 sub-branches spread over 20 provinces in China.
The company was founded in 2013 following the acquisition of a 50% stake by AXA in Chinese property & casualty (P&C) insurance company Tian Ping for €485m.
AXA Asia CEO Gordon Watson said: “The transaction marks another step towards consolidating our position as the #1 foreign insurer in China and strengthening of our leadership in the Asian region.
“With full ownership and management control of AXA Tianping, we will further accelerate the deployment of our strategy to create a leading insurer that champions healthcare and mobility solutions.”
According to AXA, in 2017, its Chinese subsidiary ranked 15th among the P&C insurers in China with Gross Written Premiums (GWP) of €1bn. Further, the French insurance giant claims that AXA Tianping is the only foreign invested company to rank among the top 20 P&C insurers in China.
The company is also claimed to be a leading player in China for direct motor insurance, with motor insurance making up 91% of its GWP, of which 41% is distributed via direct channels. AXA Tianping also offers short-term health insurance products.
AXA CEO Thomas Buberl said: “By leveraging its broad domestic presence, strong distribution capabilities, and our international brand with global Health and P&C expertise, we look forward to offering high-value products and services to our existing and potential customers in China.
“This is a “first of its kind” transaction in the Chinese insurance market whereby a leading P&C insurer, with a nationwide footprint, will be fully owned by a foreign company.”
The transaction will be completed based on meeting of customary closing conditions, including regulatory approvals from the China Banking and Insurance Regulatory Commission among others.
The French insurance giant has been engaged in the process of completing a $15.3bn merger with Bermuda-based insurance and reinsurance company XL Group.
In a separate deal made last month, AXA agreed to divest all its insurance operations in Ukraine to Fairfax Financial for an undisclosed price.