VTB and SOGAZ close deal to merge insurance assets
VTB Group has closed the deal to sell 100 percent in its insurance unit, VTB Insurance, to SOGAZ Insurance Group. The transaction includes all companies within VTB Insurance Group, including VTB Life Insurance and VTB Medical Insurance. All necessary regulatory approvals were obtained. The insurance assets will be integrated into SOGAZ with VTB receiving a 10 percent stake in the merged company and a seat on its board of directors, as well as compensation in cash. The parties do not disclose the transaction's financial terms.
VTB Insurance Group will continue to fulfil its commitments to the customers in full until the integration with SOGAZ is completed.
Within the first stage of the merger following the closure of the acquisition deal, VTB Insurance Group will continue to operate under its brand, switching to SOGAZ's brand once the integration process is completed.
Based on the forecasted IFRS financial results for 2018, the aggregate premiums paid to SOGAZ and VTB Insurance groups could reach over RUB 330 billion, while their cumulative assets could exceed RUB 670 billion.
When the transaction is completed, VTB and SOGAZ are expected to cooperate in selling insurance products to VTB Group customers and banking products to SOGAZ Group customers.
The deal to sell the insurance assets will help VTB Group focus on its banking business, while retaining a stake in a major insurance company set to become a market leader following the merger. In addition, VTB Group acquires in SOGAZ a major partner that will offer reliable insurance coverage to VTB clients.