Franco-Belgian bank Dexia has agreed to sell its stake of 99.86% in DenizEmeklilik, the life insurance and pension subsidiary of DenizBank in Turkey, to US-based insurance group MetLife, for EUR162m.
MetLife will acquire the stake through its Turkish insurance business, which is expected to increase its business significantly.
This deal also includes a 15-year exclusive agreement for the distribution of MetLife’s life, pensions, personal accident and unemployment insurance products and solutions through DenizBank’s branch network.
Dexia said the divestment is part of the agreement with the European Commission providing for the disposal of DenizEmeklilik by 31 October 2012 at the latest.
The transaction is expected to generate a capital gain of about EUR119m. The agency agreement will ensure that DenizBank will continue to provide its customers with a full range of life, pensions, personal accident and unemployment insurance products and solutions.
The agency agreement also entails a profit-sharing mechanism whereby part of the future profits generated from the sales of DenizEmeklilik products through DenizBank branches over the next 15 years will be distributed to DenizBank.
The transaction, subject to regulatory approval, is expected to take place before the end of 2011.