Cinven is considering a sale of German life insurer Viridium after another of its insurance investments in Europe, Eurovita, was hit by heavy customer outflows earlier in the year, three people familiar with the matter told Reuters.
The private equity firm is working with advisers at Fenchurch Advisory and Goldman Sachs to gauge interest in Viridium, which buys old books of policies from other insurers, two of them said.
A formal sale could kick off as soon as German regulator BaFin completes its review of a planned portfolio acquisition by Viridium, said the people, who spoke on condition of anonymity.
Cinven owns a majority of Viridium, with insurers Hannover Re and Assicurazioni Generali holding minority stakes. It is unclear if the minority investors would sell alongside Cinven in a potential transaction.
Deliberations are still preliminary, and plans may yet be altered or dropped, the people cautioned.
BaFin, Cinven, Generali, Goldman Sachs, Hannover Re and Viridium declined to comment. Fenchurch did not immediately reply to a request for comment.
Formerly part of Lloyds Banking Group, Viridium oversaw 3.6 million policies and managed assets of 65 billion euros at the end of last year. It had a book value of more than 1 billion euros in 2021, according to its latest public accounts.
The company agreed to acquire 21 billion euros worth of assets from Zurich Insurance in June 2022, but the transaction remains under review by German financial watchdog BaFin.
Reuters reported last month that the regulator was leaning towards blocking the deal. Viridium said in an emailed statement at the time that the transaction had been complicated by the collapse of Eurovita.
Italy’s insurance supervisor IVASS orchestrated a rescue of Eurovita after the company suffered from customer redemptions on the back of rocketing interest rates.
Reuters reported last week that Cinven had agreed to buy back 160 million euros worth of Eurovita’s debt to help prevent a messy liquidation of the Italian company.
(Reporting by Pablo Mayo Cerqueiro, Amy-Jo Crowley in London and Alex Huebner in Frankfurt; editing by Elisa Martinuzzi and Jan Harvey)
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