The M&A advisors that sold Vivat to Athora and NN Group

24 June 2019 Consultancy.eu

Dutch insurance company Vivat has been sold for more than €1 billion to two financial groups: Dutch counterpart NN Group and Athora, a pan-European specialised insurance company. 

Vivat – the parent of well-known Dutch insurance brands Reaal en Zwitserleven – was acquired by Chinese conglomerate Anbang in 2015 for a symbolic fee of €1 and a capital injection of €1.35 billion to return the company to health. Vivat was at the time owned by the Dutch state, which took ownership of the group when it bailed out SNS Reaal at the beginning of 2013, saving the financially strapped financial services institution from collapsing. SNS Reaal was subsequently split into a banking arm (SNS Bank) and an insurance business (Reaal, now Vivat).

While Vivat four years ago was delighted to return into private hands, its marriage with the Chinese was by no means one that passed the test of love. After booking an improvement in financials in the first year (the group inked a profit of €168 million in 2016), Vivat returned to loss in 2017. And in 2018, clouds grew on the horizon after the Chinese government put its parent Anbang under guardianship. The group was accused of using insurance premiums to finance acquisitions abroad, and after a trial, the former chief executive and founder Wu Xiaohui was found guilty and sentenced to 18 years in prison for fraud and corruption.

This change of Chinese fortunes had major consequences for the foreign participation of the company. The Chinese government demanded that Anbang would undergo a “full reorientation of all assets”, and out of this strategic process came the decision to put the Dutch company up for sale. 

Since the news broke in August last year, several insurance groups in the Netherlands have revealed their interest, including the larger players Aegon and ASR. At the presentation of their half-year results, both companies openly acknowledged they were keeping a close eye on the developments at Vivat. However, with deal negotiations now completed, it is Athora and NN Group that have sailed away with the prize.The M&A advisors that sold Vivat to Athora and NN Group

Athora

Athora has acquired the life insurance and wealth management business of Vivat, in a move that marks the firm’s entry in the Dutch market. “We are building a specialised insurance group in Europe and Vivat’s strong presence, including its compelling brand portfolio, will become a significant part of our European operations,” said Michele Bareggi, the chief executive officer of Athora. The deal comes around one year after Athora also closed a large transaction in Belgium, when it acquired Generali Belgium for €540 million from Italy-based Generali Group. The company is also active in Germany and Ireland.

Bermuda-headquartered Athora was advised during the partial transaction by investment bankers from Deutsche Bank and Aperghis & Co. KPMG provided due diligence expertise, law firms Stibbe and Slaughter and May provided legal services, while the recently founded Confidant Partners headed the strategic communications part of the deal.

NN Group

NN Group, formerly Nationale Nederlanden, has purchased the smaller non-life activities of Vivat*. The publicly listed insurance group paid €416 million for the division, and has in addition taken over around €150 million of subordinated debt.

Commenting on the deal, Lard Friese, CEO of NN Group, said, “In today’s competitive market, scale is essential to deliver attractive and sustainable customer propositions in the long term,” referring to the firm’s previous acquisition of Dutch financial services institution Delta Lloyd in 2017. In terms of the number of insurance policies, NN Group will become market leader in the Netherlands in the non-life segment – the deal still has to be approved by the regulators and is expected to close in the first quarter of 2020.

NN Group was advised on by law firm Freshfields Bruckhaus Deringer and bankers from French banking group BNP Paribas. 

Chinese seller Anbang was or both deals supported by Allen & Overy (legal consultancy), J.P. Morgan (corporate finance) and Hill+Knowlton Strategies (communications support). Other deal-makers that played a role are law firm Slaughter and May and Big Four firm PwC. 

* Formally, Vivat has been acquired in full by Athora, after which the non-life activities division has been sold off to NN Group.


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