Old Mutual Plc (OML), Africa’s biggest insurer, is selling its Skandia units in Germany and Austria for 220 million euros ($303 million) in cash.
The two businesses, part of the London-based insurer’s wealth division, are being acquired by a Cinven Ltd. and Hannover Re (HNR1) acquisition vehicle, which will rename the assets Heidelberger Leben Group, according to a statement today from Old Mutual. Skandia Germany and Austria had combined funds under management of 4.9 billion euros at the end of 2013.
Former Chief Executive Officer Jim Sutcliffe bought Stockholm-based Skandia AB for 56 billion Swedish kronor ($8.4 billion) in 2006 to lessen Old Mutual’s dependence on South Africa. The insurer, which still makes most of its profit in Africa, is focusing more on the continent since Sutcliffe’s departure in 2008 and has also sold its Finnish and Polish Skandia units in the past two years.
The Germany and Austria sale may be completed by the third quarter, according to Old Mutual. The company is looking for more acquisitions in Ghana, Kenya and Nigeria this year, CEO Julian Roberts said on Feb. 28.
The insurer was little changed at 199.9 pence as of 8:57 a.m. in London trading.
Source: Bloomberg (by Renee Bonorchis)