RSA Insurance Group Plc agreed to sell its Italian business to ITAS Mutua, the country’s oldest customer-owned insurer.
RSA will transfer 434 million pounds ($698 million) of liabilities to ITAS and receive a payment of 19 million pounds, the London-based company said in a statement today. The U.K. insurer expects to recognize a 28 million-pound gain, boosting its capital surplus by about 50 million pounds.
“This transaction continues the excellent momentum of our announced disposals in 2014 and represents further progress in tightening the strategic focus of the group,” RSA Chief Executive Officer Stephen Hester said in the statement.
The sale of RSA Italy comes amid eight months of disposals for Hester, who is reversing a decade of expansion in the wake of an accounting scandal in Ireland and a 775 million-pound rights issue. The former banker has sold businesses throughout Asia, the Baltics, Poland and Canada, raising more than 600 million pounds, double his target for year end.
RSA Italy writes both personal and commercial insurance and accounted for 221 million pounds of net written premiums and a 1 million-pound underwriting loss for the group in 2013.
The insurer still has operations in France, Belgium, Germany, the Netherlands, Spain, the U.K. and Ireland as well as Scandinavia. Outside of Europe, it owns units in the Middle East, India, Canada and Latin America.
ITAS was founded in 1821 and is based in Trento, Italy with 700,000 insured members, according to the statement.
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