Owners Plan To Make Eureko Into Full Service Insurer

Plans to create a truly pan-European insurance company out of Eureko, up to now a rather loose partnership of eight European insurers, advanced significantly on Monday with the the announcement that Banco Commercial Portuges (BCP) and Holland’s Achmea will merge their insurance holdings into Eureko.

Achmea, a financial services group, would control 72.2 percent and BCP 15.1 percent. The remaining shareholders, the Swedish LF Group, France’s MAAF Assurances, Germany’s Parion, Denmark’s Topdanmark, Switzerland’s SwissMobilar, and the UK’s Friends Provident, a mutual company, would hold the remaining shares, and could choose to more actively participate in Eureko, or not.

Insurance companies in both Portugal and the Netherlands have pretty well consolidated, therefore insurers are looking to expand outside of their home markets. “The integration of the dynamic and mature insurance groups of Achmea and BCP into Eureko will mark the first step towards the launching of a financial services group with aspirations of becoming a leading Pan-European insurer,” the companies told Reuters News Agency.

With total assets at the end of 1999 of €46.8 billion ($45 billion) Eureko would be one of the top 15 largest European insurers. The next step is to be a public share offering within the next two years on the London and Amsterdam Stock Exchanges, which would raise an estimated €10 billion ($960 million) in additional capital for expansion and further acquisitions.

Such a public offering would also greatly increase Eureko’s value. Britain’s Daily Telegraph estimated that Friends Provident’s stake might be worth as much as £1 billion ($1.52 billion).

Topics Carriers Europe