Banca Transilvania has signed the sales contract for BT Asigurari (BT Insurance) with Groupama, a French financial group with operations in Europe and Asia, with 90% of the company sold for at least 90 million euros, thus confirming information published by ZF at the beginning of the month, which revealed the bank had started exclusive negotiations with the French.
"While the initial price considered stood at 60-70 million euros, the transaction was eventually closed at 90 million euros. The rise is because BT Asigurari is one of the last options open for foreign players to enter the market through the acquisition of a top-ranking company. What also counted is that behind the company is Banca Transilvania, which is ranked fifth on the market," Ciprian Ghetau, mergers and acquisitions manager of the investment firm Capital Partners, which advised Banca Transilvania during the sales process, told ZF.
As a result, BT Asigurari (ranked tenth on the market in 2006) is now worth around 100 million euros. So far, this is the highest price paid for an insurance company on the Romanian market, against turnover. The French paid almost 1.14 euros per 1 euro of turnover, with BT Asigurari estimating gross underwritten premiums worth 88 million euros this year, up 47% on last year.
In most cases, the level of transactions conducted over the last few years on the insurance market did not exceed 1 euro per 1 euro of turnover, standing at around 0.7 - 0.8 euros.
At the end of July, the Austrian group Vienna Insurance bought 30% in Asirom for 47 million euros, for around 0.7 euros per 1 euro of turnover, putting the company's value at 157 million euros. In May 2005, when the same Austrians took over Omniasig, the price stood at almost 0.8 euros per 1 euro of turnover, putting the company's value at 90 million euros.
BT Asigurari is now one of the most expensive insurance companies on the market, and its value could still increase, depending on the company's results for this year, in line with an announcement published by Banca Transilvania on the Stock Exchange.
According to Capital Partners, Groupama has also bought the remaining 10% in the company, held by the majority shareholders.
All the large investment banks on Wall Street representing important financial groups showed interest in acquiring BT Asigurari from Banca Transilvania, due to the fact that it is one of the last options open to enter the Romanian insurance market, which continues to increase 30-40% year-on-year.
"Six months ago, when the company's sales process started, we were contacted by all the large investment banks on Wall Street, each of them commissioned by world-class clients. We were contacted by at least 25 different companies, until as late as a few days ago, when the contract with Groupama was almost signed," added the investment firm's representative.
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