VTB and SOGAZ announce merger of the insurance business
VTB Group has agreed the sale of 100 percent stake in VTB Insurance to SOGAZ Insurance Group. In addition to monetary consideration VTB Group will receive a 10 percent stake in the united company that will operate under SOGAZ brand.
This is a unique transaction in terms of scale and the impact it will have on the Russian financial market. The merger of two leading insurers will result in the emergence of Russia's largest insurance company in history with high financial sustainability as well as the most balanced insurance portfolio on the market.
The merged company will have the unique expertise across all the insurance segments. SOGAZ will benefit from VTB Group's competencies in bank and retail insurance, in addition to its variety of insurance offers, currently dominated by corporate and private health insurance.
By integrating core assets as part of the agreement, the merged company is set to become an absolute leader in the key segment of mandatory health insurance, and a major player in life insurance market.
The transaction will generate a significant benefits for both partners. The strategic partnership will allow SOGAZ to get an opportunity to expand its offers using VTB Group's best practices, while VTB Group gets a major and reliable partner for providing insurance coverage to its clients.
The total accrued premium of the SOGAZ Group insurance business and VTB Group, based on financial indicators under IFRS for 2017, estimated at RUB 280 billion, total assets - RUB 550 billion.
The closing of the transaction is scheduled for the third quarter of 2018 subject to necessary regulatory approvals.