EIG sells 48.6% stake in insurer Euroins to Russian co due to exit from Russia
MOSCOW. Jan 16 (Interfax) - Euroins Insurance Group (EIG), a division of Eurohold Bulgaria, has sold its subsidiary in Belarus and 48.6% stake in Russian insurer Euroins LLC as part of its exit from Russia, the group said.
As of 2023, the group "will no longer consolidate their results in its financial statements," but EIG retains "its participation in insurance companies in the other countries in the region in which it operates - Ukraine and Georgia," the group said in a press release.
"The sale of the interest in both companies is part of our strategy to focus only on key markets with good growth potential," Eurohold CEO Kiril Boshov was quoted as saying in the press release.
EIG's business in Belarus and Russia generated less than 1% of its total revenue, the group said.
Commenting on the sale of EIG's stake, Euroins LLC told Interfax that the new owner is a "Russian legal entity affiliated with the Russian founders of the company and management." The new owner understands and is "very familiar" with the insurance business, the company said.
The timing of the closure of the deal depends on obtaining approvals from Russia's Federal Antimonopoly Service (FAS) and Central Bank. "After all necessary procedures are completed, the deal will be completed as soon as possible," the company said.
The Russian insurer said it understands EIG's decision and remarked that the "change of owner will in no way affect the company's business and its plans for further development." EIG "was an associated participant, the main decisions regarding the company's operations were made by the board of directors and CEO," Euroins LLC said.
All of EIG's obligations to Euroins LLC will be met in full by the time the sale is completed, the Russian company said, adding that it remains a "stable non-credit financial institution, as evidenced by operating results."
EIG acquired its 48.6% stake in Euroins LLC, which has been operating since 2004, in 2018. The insurer said "EIG's participation made a significant contribution to the company's development, and made it possible to improve the compliance system, increase many management competencies, and improve the general structure of governance and internal control."
Euroins LLC sees voluntary health insurance, accident insurance, voluntary and mandatory auto insurance, travel insurance, personal and corporate property insurance and construction insurance as its priorities.
Euroins holds licenses from the Central Bank of Russia for reinsurance, mandatory third-party liability motor vehicle insurance and voluntary personal insurance, with the exception of voluntary life insurance and voluntary property insurance.
Euroins was Russia's 47th largest insurer by premiums in 2021 with 3.25 billion rubles, up 23.4% from 2020. The company's payouts rose 58.6% to 1.4 billion rubles, or 42.7% of premiums, compared to 33.2% in 2020. The company's market share by premiums was unchanged at 0.2%.
EIG specializes in providing protection in the area of general, health and life insurance. The Bulgarian company operates in 12 European countries, and has more than 3 million customers and a staff of 3,000.