The Slovenia Times

France's Coface to buy SID Bank's insurance arm

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Announcing the deal signed on Thursday, SID Bank said that a binding bid had also been submitted by Slovenia's insurer Zavarovalnica Triglav, but Coface offered more in purchase money as well as good prospects for further growth, development and expansion of the acquired insurer.

SID Bank decided to sell the insurance arm as part of its strategic focus on core business. The procedure was launched in March 2017, and after due diligence, binding bids were submitted by Triglav and Coface.

After intensive talks with both prospective buyers, Coface submitted a much improved offer in all aspects. A partnership contract could not be reached because both bidders insisted on acquiring an outright stake in the insurance company.

SID Bank also examined the potential investor's plans about internationally comparable insurance of claims by Slovenian businesses, digital product development and resumption of reinsurance nonmarketable risks as part of SID Bank, which will continue to provide these insurance services for Slovenian companies in risk export markets.

Coface expressed interest to continue to provide and develop insurance products, competitive insurance terms and high level of services for clients, as well as to keep SID - Prva Kreditna Zavarovalnica and its brand, among other things.

Coface pledged that SID - Prva Kreditna Zavarovalnica could become a key point of its activities in the SE Europe and the Adriatic region.

On signing the contract, SID Bank chairman Sibil Svilan said that as a specialised promotional development bank in sole ownership of the state, SID Bank faced regulatory restrictions in Slovenia and the EU when it came to investing in the development of the insurer which provides commercial services.

He added that "many Slovenian companies have passed into the ownership of foreign firms which have more competitive options in their countries to benefit from these insurance services in foreign markets".

The new strategic partner will be able to provide more competitive options of development and further expansion of operations for domestic and, above all, foreign companies present in Slovenia, he said.

"This will positively affect underwriting of nonmarketable risks that we will continue to provide in SID Bank. In this way SID Bank and Coface will be able to provide Slovenian companies with new, additional, more competitive and internationally comparable services and terms, including the international network which the SID Bank Group does not have," said Svilan.

The deal was also welcomed by Declan Daly, Coface CEO for Central Europe. Coface expects the acquisition to enhance its presence in the region and improve services for its clients, while it will allow SID - Prva Kreditna Zavarovalnica even more effective development, the French company said.

The closing of the transaction is pending on regulatory approval, which SID Bank expects to be issued in the coming months.

With over 70 years of experience, Coface provides credit insurance and risk management services. The company employs some 4,100 experts serving around 50,000 companies worldwide. The company's consolidated turnover in 2015 was EUR 1.49bn.

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