AXA has confirmed earlier reporting that it has agreed to sell its operations in Poland, Czech Republic and Slovakia to Austria’s Uniqa Insurance Group.

AXA will sell 100 percent of its life and savings, property/casualty and pension businesses in Central and Eastern Europe for a total cash consideration of euro 1,002 million, or close to $1.1 billion, representing an implied 12.4x 2019E P/E multiple.

The completion of the transaction is expected to result in a positive impact on AXA Group’s Solvency II ratio of approximately 2 points. AXA said it does not expect any significant net income impact from this transaction.

The transaction marks another step in the simplification of AXA’s footprint.

For Uniqa, the deal represents five million new customers and €800 million in additional premiums in three markets where it says it is already profitable and where it sees potential for growth. The product mix is almost balanced, with 35 percent in life insurance and 65 percent in property business.

Uniqa CEO Andreas Brandstetter said AXA companies are an “excellent fit with our long-term strategy.”

Uniqa Group is one of the leading insurance groups in its core markets of Austria and Central and Eastern Europe. Its 20,000 employees and exclusive sales partners serve 10.1 million customers in 18 countries. Uniqa is the second-largest insurance group in Austria with a market share of more than 21 percent. Uniqa operates in 15 markets: Albania, Bosnia and Herzegovina, Bulgaria, Croatia, the Czech Republic, Hungary, Kosovo, Macedonia, Montenegro, Poland, Romania, Russia, Serbia, Slovakia and Ukraine. The group also includes insurance companies in Switzerland and Liechtenstein.

Completion of the transaction is subject to customary closing conditions, including the receipt of regulatory approvals, and is expected to be finalized by Q4 2020.

AXA Poland offers a full range of Life and Savings (L&S), Property and Casualty (P&C), Pension, and Asset Management products to 3.2 million customers. The company has 1,575 employees and distributes its products through two multichannel networks, dedicated to P/C and L/S. It also benefits from an exclusive and multiproduct bancassurance partnership with mBank. In 2018, it was ranked 6th and 9th in P/C and L/S markets respectively and 6th in the pension market. Revenue* of AXA Poland in 2018 were Euro 585 million.

AXA Czech Republic and Slovakia offers a suite of L/S, P/C and pension products to 1.6 million retail customers. The company has 527 employees and operates as one integrated platform, under a single management team active in both countries, through three Czech entities with branches in Slovakia. It has a diversified distribution mix consisting of brokers, tied agents and direct distribution channels. In 2018, it was ranked amongst the top 10 players in terms of market share in P/C, L/S and pension markets in both Czech Republic and Slovakia. Revenues of AXA’s operations in Czech Republic and Slovakia in 2018 were euro 170 million.

Source: AXA

*A version of this story ran previously in our sister publication Insurance Journal.