NN Group, a Dutch financial services group, has agreed to acquire Aegon’s life insurance arm in Czech Republic and Aegon’s life insurance and pension operations in Slovakia in a deal worth €155m ($177m).
The acquired businesses offer unit-linked products, term life products, riders, and pension services. Together, the two businesses reported underlying earnings before tax of €16m last year.
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NN Group has expectations for the deal
NN Group noted that the deal aligns with its plan to achieve value creation. Also, the firm will pay for the transaction using its existing liquidity.
The Dutch group expects its operating result and solvency II ratio to remain materially unaffected by the deal.
“This bolt-on acquisition will strengthen NN’s position in the Life insurance market and its distribution network in the Czech Republic and Slovakia, and will further strengthen its leading position in the Slovakian Pension market,” NN group said in a statement.
On the other hand, Aegon expects the deal to boost its group solvency ratio by around one percentage point. It also expects a book gain of around €80m from the deal.
The deal will be completed by the first quarter of next year, subject to regulatory nod.
Aegon CEO Alex Wynaendts said: “This divestment is a further step in rationalising our geographical footprint and focusing our resources on our key markets. The transaction guarantees continued customer service, offers new opportunities for employees, and is in the best interest of our shareholders.”
