Assicurazioni Generali, one of Europe's largest insurance groups, has offered to pay E3.9 billion for fellow Italian insurer Toro Assicurazioni.
Generali has offered to buy 56% of Toro from De Agostini for E21.20 a share in cash, a move that would make it Italy’s biggest property and casualty insurer.
The cash purchase would give Generali, already the country’s largest life insurer, a controlling stake in the Toro group which would subsequently be de-listed via a transaction that would see its insurance business merged into that of Generali.
Toro is majority-owned by De Agostini, a private conglomerate that acquired control of the company in 2003.
Generali said it could pay around E2.5 billion for De Agostini’s shares in Toro and offer to buy out the remaining shareholders for a total maximum outlay of E3.9 billion.
Generali, which sees the deal as vital for organic growth, plans to find E180 million in cost synergies by 2009, which it believes is an achievable target as the deal is in its home market.