"Green line" for EUROINS to acquire Georgian insurer IC Group

Bulgaria's EUROINS Insurance Group (EIG) stated that it has acquired IC Group, one of the leading insurers in Georgia. The regulatory approval for the purchase agreement has already been granted.

After closing the transaction, which includes an increase of IC Group's capital, EIG will own over 50% of the Georgian insurer and will consolidate the results of its new entity within the third quarter of 2018.

The IC Group has been operating since 2005 and is among the leading Georgian insurance companies, providing almost all types of insurance products. In addition to that, it is one of the largest players on the health insurance market. The company is expected to record GWP of EUR 5.4 million (45% growth y-on-y) in 2018. The IC Group has over 100 employees.

EIG representatives pointed out that the acquisition of the Georgian insurer is in line with EIG's strategy to expand its operations in Eastern Europe and the CIS region, where the markets have an enormous growth potential, considering the low penetration of insurance products. "In Georgia, particularly, positive regulatory reforms and mandatory third-party liability (TPL) insurance in both the motor and construction industry, which is expected to be enforced by the end of 2018, will further boost the insurance business in the country".

The Georgian insurance market recorded double digit growth in premium (+12.3% y-o-y) in 2017 and is expected to double in size over the next 3 years, driven by the introduction of mandatory MTPL insurance and the positive economic development of the country. The Georgian economy grew by 5% in 2017 and is expected to increase by at least 4.6% this year.

"The purchase of the Georgian IC Group will help us expand and diversify our business geographically. EIG would be among the first international insurance groups with presence in Georgia. We will also enhance our regional profile as the acquisition strengthens our market position in the CIS region. EIG remains committed to investing in the Georgian market and in the operational capabilities of the IC Group, as it clearly sees potential for further development and growth in the Black Sea state," explained Jeroen Karel van Leeuwen, chief operating officer of EIG.

In July 2018, the financial regulator in Ukraine gave the nod to EIG to acquire ERV Ukraine, the travel insurance business of Germany-based ERGO, part of MUNICH Re, one of the major reinsurance groups on the global market. The purchase agreement was signed in April this year. The shares are expected to be transferred by the end of the third quarter of 2018.

In the last couple of years EIG acquired Germany-based TALANX Group's subsidiaries in Bulgaria and Ukraine, operating under HDI bran; Dutch insurer ACHMEA's insurance business in Bulgaria, known under the Interamerican brand; as well as Australian group QBE's operations in Romania and Bulgaria. In 2017, its Bulgarian-based company purchased the non-life insurance portfolio of ATE Insurance Romania, a subsidiary of Greece's PIRAEUS Bank, and acquired a significant stake in RSOEuroins, a Russian insurer.

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