Economy

Allianz takes a £500m stake in LV= as new insurer launched

Allianz takes a £500m stake in LV= as new insurer launched”

Allianz is taking a major stake in the general insurance (GI) business of United Kingdom underwriter LV= in a joint venture deal staged over the next two years.

A source close to the matter told Reuters that negotiations were about to be finalised and the deal was expected by the end of this week.

Allianz Insurance CEO, Jon Dye commented: "I am delighted that two organisations with excellent reputations in both personal and commercial lines have forged a landmark partnership with the twin aims of benefiting customers and generating profitable growth".

LV= also ranks as one of one of Britain's biggest financial services mutuals, with about 5,700 employees.

A subsequent £213m deal to raise Allianz's stake in the joint venture to 69.9% will take place in 2019.

Today LV= has confirmed the deal with Allianz has gone ahead and it will see the creation of a new joint venture under the LV= brand. The transaction is subject to regulatory approvals.

Olvier Bäte, chief executive at Allianz, said: "This partnership will first and foremost benefit our customers who will have access to an expanded range of products backed by the financial strength of Allianz".

The statement continued: "The transaction also strengthens Allianz's position in the commercial market where it has over £1bn in annual income and complements its broader United Kingdom presence including the market leading Petplan brand, and strong positions in legal expense and musical insurance".

As part of the transaction, Allianz will obtain LV= GI's commercial insurance renewal rights.

In April this year, LV= announced that its general insurance business plunged to a full-year loss of £26mln following United Kingdom government moves to amend the Ogden Discount rate at which compensation rates are calculated in personal injury claims.

The German firm is the largest property and casualty (P&C) insurer in the world.

Steve Treloar, the managing director of LV's general insurance business, will spearhead the joint venture and report to a board of directors from both LV and Allianz.



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