Liberty Mutual and Talanx Group announced that the retail international division of the Talanx agreed to acquire the Liberty Seguros personal and small commercial business in Brazil, Chile, Colombia, and Ecuador.
The joint announcement over the weekend put the purchase price at about EUR 1.4 billion, or roughly $1.5 billion.
Talanx, a major European insurance group based on Hannover, Germany with premium income of EUR 37 billion (or about $40 billion, 2022), operates under a number of different brands. These include HDI, delivering insurance solutions to retail customers and industrial clients, and Hannover Re, one of the world’s leading reinsurer.
Talanx said it believes the deal will vault the group to become the third-largest insurer by premium income in property/casualty business in Latin America.
HDI is expected to increase its gross written premiums in Latin America by around EUR 1.7 billion ($1.8 billion) when the deal is done, becoming the largest player in Chile and second-largest in Brazil.
The transaction includes Liberty Specialty Markets direct insurance business in Brazil, Chile and Colombia. It does not include Liberty Specialty Markets facultative reinsurance, Liberty Mutual Reinsurance treaty reinsurance and Liberty Mutual Surety businesses which will continue to operate in Brazil, Chile and Colombia.
Torsten Leue, Chairman of the Board of Management of Talanx AG, said the “The acquisition fits seamlessly into our strategy of achieving market-leading positions in our core markets through organic and inorganic growth. Alongside Europe, Latin America is one of our core regions in the retail business.”
Dr. Wilm Langenbach, chief executive officer of HDI International AG, called the deal “an important milestone” in a strategy to reach a top five position in core P/C markets by 2025.
At Liberty Mutual Insurance, Tim Sweeney, president and CEO, said: “In a world that is rapidly changing, sharpened operational focus across our channels, products and markets is becoming increasingly important for long-term success and will ensure we deliver exceptional value to our customers, brokers, agents, partners, employees, and the communities we serve.” Sweeney went on to thank Liberty’s Latin American teams of over 4,600 employees for their tremendous commitment and dedication to our business over many years. “We’re confident in their future with Talanx, which shares similar core values,” he stated.
Liberty Mutual operates in 29 countries.
According to the joint statement, the companies involved in the deal had the following rankings in Latin America in 2022.
- Liberty Seguros Brazil held a top five position in motor and a top 10 position. Gross written premiums were EUR 1.1 billion ($1.2 billion); HDI Seguros generated a gross premium volume of around EUR 789 million ($846 million) in Brazil.
- Liberty Seguros Chile offers non-life products and achieved a gross premium volume of EUR 0.4 billion ($0.4 billion); HDI Seguros in Chile generated a gross premium volume of EUR 533 million ($572 million)
- Liberty Seguros Colombia’s gross premium volume was EUR 0.2 billion ($0.2 billion); HDI Seguros in Colombia generated EUR 82 million ($88 million)
- Liberty Seguros Ecuador generated a gross premium volume of EUR 31 million ($33 million)
The closing of the acquisition is expected in the first half of 2024. The transactions are subject to approval by the relevant governmental and regulatory authorities.