Austrian group Vienna Insurance Group, the biggest player on the Romanian insurance market, signed a contract with French group AXA to take over its local business, VIG announced on Thursday, August 4.

VIG hasn’t disclosed any of the deal’s financial details. However, according to local Profit.ro, the French group has agreed to bring EUR 30 million worth of fresh capital to its Romanian subsidiary before VIG takes control, to cover for the risks generated by an early closing of the insurance contracts owned by AXA’s clients, which are high-value life insurance contracts.

AXA Life generated more than EUR 4.5 million gross premium income in 2015, but was not in the top 10 biggest companies on this segment.

Vienna Insurance Group owns three insurance companies in Romania: Omniasig and Asirom on the general insurance segment, and BCR Asigurari de Viata on the life insurance segment. BCR Asigurari de Viata was the second-biggest player on the life insurance segment last year, with gross written premiums of EUR 59 million and a market share of 14.5%.

VIG was also interested to take over AXA three years ago when the French first decided to sell, but Astra Asigurari, owned by Romanian businessman Dan Adamescu won the bid. However, the deal fell through due to Astra’s financial problems.

Astra went bankrupt in August 2015 and Adamescu said that ASF was responsible for this because it didn’t approve the Astra-AXA deal, which would have brought some EUR 21 million fresh capital to Astra’s accounts.

Romanian asset manager Certinvest also reached an agreement to buy AXA last year but once again ASF opposed the deal saying that the buyer didn’t have the financial capacity to support it.

editor@romania-insider.com