Helvetia Insurance said that the deal to acquire a 70% stake in Caser has been approved by the Spanish insurance supervisory authority and the European competition authority
Helvetia Insurance to acquire 70% stake in Caser. (Credit: Helvetia Group)
Helvetia Insurance is set to close its previously announced €780m acquisition of a stake of about 70% in Caja de Seguros Reunidos (Caser) having secured key approvals.
The Swiss insurance group said that the deal has been approved by the Spanish insurance supervisory authority and the European competition authority. As a result, the company expects to wrap up the acquisition at the end of this month.
Helvetia Insurance said that the timing of the closing of the deal means that the consolidation will only impact the balance sheet and not the income statement of its half-year results.
The Swiss insurance group revealed that it has secured funding of the proposed takeover via existing liquidity. It further said that refinancing with equity and hybrid capital will take place once the market conditions are appropriate.
Caser is a Spanish insurance and reinsurance company, which made revenues of in 2018, of which nearly 62% were related to its non-life business. The Spanish insurance company had a profit of €87m in 2018.
Why Helvetia Insurance is acquiring a stake in Caser
By acquiring Caser, Helvetia Insurance expects to significantly improve its market share in Spain, while consolidating its core business.
The combination of the two firms is likely to become the seventh-largest provider of non-life insurance in Spain.
The Swiss insurance group stated: “The acquisition will further strengthen the European business as a second pillar, significantly expand the attractive non-life business and increase sales capability in Spain.”
Caser is said to have distribution agreements with Ibercaja, Unicaja, Liberbank, and other banks. The bank distribution partners will have a stake of about 30% in the Spanish insurance and reinsurance firm.
At the time of signing the deal in January 2020, Helvetia Insurance said that the Spanish firm will continue its business with its existing brand and so will Helvetia Spain. There will also be no changes in the management teams and locations of the two firms, said the Swiss insurance group.