The takeover will merge the Slovenian insurance companies Zavarovalnica Generali and Adriatic Slovenica, which will become official at the beginning of next year, with the new insurer named Generali.

Until then, the two insurance companies will operate separately, Zavarovalnica Generali said in a press release as it announced Wednesday's decision of the insurance market watchdog.

The company said that all existing insurance policies in both insurers would remain unchanged and valid until their expiry. Their clients will be notified about the exact date of the merger and other information in writing.

"The merged insurance company Generali will, as a lifelong partner and one of the leading insurers on the market, provide its clients with an expanded and even more accessible sales network in entire Slovenia."

KD Group sold its outright stake in Adriatic Slovenica to Generali CEE, a subsidiary of the world's third largest insurer, for EUR 245 million in May 2018.

The merger will create the second largest insurance company in Slovenia, with an estimated market share of 19%. Currently, Slovenia's largest insurer is Zavarovalnica Triglav, followed by Zavarovalnica Sava.

In 2017, the Adriatic Slovenica group generated EUR 11.4m in net profit, down 4.2% over 2016. In the first nine months of 2018 (the latest data available), it posted a net profit of EUR 9.6 million.

The group has more than 1,000 employees, and offers property, car, health, life and pension insurance. It has more than 500,000 clients and 1.7 million insurance policies. It sold EUR 304 million in gross premiums in 2017.