Slovenian insurer Triglav eyes Italy's UnipolSai stake in Serbian peer DDOR - report

By bne IntelliNews January 20, 2014

Slovenia's largest insurer Triglav is reportedly entering talks with Italy's UnipolSai on acquiring its 100% stake in Serbian peer DDOR, Slovenian daily Dnevnik reported on Jan 20, quoting unnamed sources. DDOR, which has been facing problems with shrinking premiums and market share, has been targeted by Triglav already several times in the past.

According to the report, Triglav already signalled its interest in DDOR and is in initial conversations with UnipolSai, while the real negotiations should start in February or March. Triglav officials declined to comment the information, saying their strategy until 2017 aims for further growth and expansion in the region of former Yugoslavia, where it is already a key player.

Previous reports speak about Triglav's plans to raise its market share in Serbia, where it already has a unit of the same name, to at least 10% in the medium term from the current 3%. DDOR, on the other hand, controls some 13-14%. It ranked the fourth largest insurer in the country at end-Sep 2013 in terms of assets after state-owned Dunav Osiguranje, privately-held Delta Generali and the local unit of Vienna Insurance Group. A total of 28 insurers and reinsurers were active in Serbia at the end of 2013.

Last year, Triglav was also in the run to acquire Croatia's top insurer - Croatia Osiguranje, but the deal was eventually awarded to local Adris Grupa, which pledged to pay EUR 120mn for the 39% stake plus further EUR 110mn in  recapitalisation. According to Dnevnik, Triglav's costs for DDOR will be significantly lower since the Serbian company is evaluated at EUR 40-80mn even though some six years ago (when it controlled a third of the market) Italy's Fondaria-Sai paid over EUR 260mn for it.

UnipolSai is the insurance arm of the Unipol Group, which became operational earlier this month following the merger of Unipol's insurance business with Fondiaria-Sai back in 2012. Since the merger created Italy's second biggest insurer, the antitrust body ordered the sale of some assets.

Fondiaria-Sai acquired 83.3% of DDOR in early 2008 from the Serb government but raised its stake to 100% later that year.

According to the report of the Slovenian daily, DDOR's premium fell 14% y/y to EUR 56mn in Jan-Sep 2013, which widened the nine-month loss to EUR 1.8mn (no y/y comparison was available). 

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