Generali closes deal to acquire Tranquilidade for 600M€

Generali has beaten Catalana Occidente on the race for Seguradoras Unidas, purchasing it for 510M€ from Apollo. The deal also includes the acquisition of AdvanceCare for 90M€, which allow the Italian insurer to consolidate its presence in the European market.

The transaction, confirmed by both Generali and Apollo, “occurs in a moment of natural evolution for both Seguradoras Unidas and AdvanceCare as it reflects the work developed by employees and partners so far” as referred by Apollo. Recall that Apollo bought Tranquilidade to Novo Banco for just 40M€, despite injecting more than 150M€ to increase the Portuguese insurer’s capital.

The American fund adds that “both companies are now stronger, showing a clear tendency of growth and rentability improvement, being both sustained by an excellent reputation as well as solid financial indicators.” Seguradoras Unidas gathers Tranquilidade (former BES), Açoreana (former BANIF) and Logo as it obtained a profit of 50.6M€ last year.

Apollo aimed at obtaining between 500M and 600M€ from the deal, successfully convincing Generali to pay the highest price for it. Generali, for instance, successfully defeated Catalana Occidente, Mapfre, Ageas, Zurich and Allianz.

The acquisition of Seguradoras Unidas “will allow us to optimise our strategic positioning in the country as well as to capture new business opportunities and reach important cost reductions”, Jaime Anchústegui Melgarejo, Generali’s CEO, said.

“These acquisitions represented an important step for the implementation of our 3-years strategy to turn the group into a leading insurer in Europe”, highlighting that AdvanceCare is a “scalable” product in other markets, which “perfectly fits the company’s 2021 strategy” of increasing revenues based on services.

Adding Seguradoras Unidas and AdvanceCare to its operation in Portugal, Generali will expand its market share to 18.7%, becoming the second-largest group dealing with non-life insurance in Portugal.