The reinsurer Swiss Re sold its subsidiary ReAssure in a multibillion-dollar transaction to the UK's Phoenix Group. Originally ReAssure should have been in the summer on the stock market, but the IPO was cancelled due to lack of interest from investors again.
The transaction), according to the message from the Friday, with 3.25 billion British pounds (the equivalent of about 4.2 billion Fr. rating, whereby Swiss Re will receive a cash payment of 1.2 billion pounds and the Rest in shares of the Phoenix. This percentage corresponds to 13 to 17 percent in Phoenix, in addition, the Swiss reinsurer receives a seat on the Board of the British.
ReAssure specializes in the management of closed life insurance Portfolios. The company buys stocks of life insurance policies, mainly of British insurers. This can use in the own balance sheet, freed up capital for other purposes. ReAssure yourself of the recorded life insurance policies maintained up to their maturity.
completion in mid-2020
The minority shareholder of ReAssure, the MS&AD Insurance Group, currently holds 25 percent, to ReAssure, and will also receive shares in Phoenix, and although a share of between 11 and 15 percent. The number of shares, which will receive the Swiss Re MS&AD, is the share price at the closing of the sale dependent, while the total share of the two companies is set to around 28 percent, as it is called.
The closing of the transaction is planned for the middle of next year. The shareholders of the Phoenix, the regulatory and the antitrust authorities will need to agree to.
use of funds still unclear
Swiss-Re-Chef Christian Mumenthaler was satisfied with the solution: "We are convinced that this transaction maximises the long-term value for the Swiss Re shareholders." The group wanted to bring in last summer, a part of the ReAssure shares on the London stock exchange, but that's due to a lack of interest from big institutional investors has been nothing. Most recently, it was said then that they wanted to reduce the stake to below 50 percent.
want to make the Swiss Re with the money from the transaction is still open. The Board of Directors will consider the "optimal use of the sale proceeds", taking into account the capital position by the end of 2019, it was said to. With the publication of the annual results on 20. February, you will then inform about the current status.
The exact financial impact of the transaction for Swiss Re, depend on the fluctuations of the Phoenix share price prior to the closing of the sale. From today's perspective, Swiss Re estimates that the transaction leads to an increase in the SST ratio Swiss Re group by 12 percentage points. The SST (Swiss Solvency Test) is a means to quantify the risk-bearing capacity of local insurers, and to regulate.
More the Swiss Re expects the sale to an economic profit of 0.3 billion US Dollar. In the current fourth quarter estimated pre-tax expense of approximately 0.3 billion US Dollar to fall, however.
The transaction is coming from investors in the first reactions well. The Swiss Re share price gained in the premarket trading of Julius Baer 2.2 percent. The total market SMI rose by 0.4 percent. (sda)
Created: 06.12.2019, 07:20 PM