German insurer Gothaer, an about EUR4 billion business, is in talks to buy Platinum, a small company owned by former Omniasig chairman Constantin Toma, insurance market sources say. Constantin Toma could not be reached for comment.
Gothaer spokesperson Martina Fassbender confirmed interest in the local insurance market and talks being conducted in view of entering it, but did not specify what the acquisitions targets were. The quoted sources said that the German company was actually in talks with two local insurers.
FT Deutschland, the German language version of the Financial Times, at the end of last month reported such talks were in progress, citing German insurance market sources.
Gothaer, an insurer with an almost 200-year history had kept a low profile outside its home market, Germany, until recently, but is currently expanding in Central and Eastern Europe. Hence the interest in the Romanian market, Martina Fassbender said.
The German insurer bought Polskie Towarzystwo Ubezpieczen (PTU), one of the top ten insurance companies in that country at the end of 2010 and said at the time that other markets in the region, Romania included, looked promising.
Gothaer enters a market with a very tight competition, where the major European insurers such as Allianz, ING, Generali and Vienna Insurance Group have been operating for years. This did not prevent other big names like Groupama and AXA from expanding their business to it lately.
The German insurer’s strategy to expand eastward in Europe’s emerging countries comes after repeated attempts to consolidate its business on its home market via mergers and acquisitions failed.
Platinum is a small local company, with about 11 million lei (EUR2.53 million) in revenue in the first nine months of 2011. It is interesting to Gothaer because of the mandatory home insurance, as Platinum is one of the main shareholders of the Disaster Insurance Pool (PAID), the issuer of mandatory home insurance policies.
It arrived on the market as a subsidiary of Israeli-held Clal in 2006 but turned out to be unsuccessful and was sold to a group of investors in 2009, who sold it to Constantin Toma in 2011, after he left the helm of Omniasig.
(English version by Loredana Fratila-Cristescu)