Australian insurance specialist QBE Insurance Group has completed the acquisition of two US insurance companies, namely Praetorian Financial Group and Winterthur US, significantly expanding its footprint in the country. Both transactions closed on May 31, 2007.
QBE bought Praetorian Financial Group from German finance giant Hannover Re, while Winterthur’s US property and casualty operation was purchased from French insurer AXA.
The total purchase price for both companies amounted to A$2.5 billion. The group estimates profit after tax and funding costs from the two acquisitions of A$380 million in the first full year, and synergies of an estimated A$50 million after tax by the end of 2008.
The sale of Praetorian Financial Group will allow Hannover Re to focus on its reinsurance business, while the sale of Winterthur’s US insurance business was a result of a strategic review.