Allianz to take £175 million hit with sale of unit

Allianz has stated that it anticipates an estimated loss of 200 million euros (£175 million), following Oldenburgische Landesbank’s sale to Apollo.

 

The insurer announced late on Friday that it had made an agreement to sell its 90% stake in the bank for 300 million euros - and it added that the loss would not impact its 2017 profit outlook, as reported by Reuters.

 

Allianz had acquired OLB as part of Dresdner Bank 16 years ago.

 

Meanwhile, Apollo, which is consolidating the northern German banking market and has also expressed interest in HSH Nordbank, will attach OLB to its Bremer Kreditbank, which it acquired three years ago.

 

The European Union’s (EU) new capital rules that commenced early 2016 have been prompting insurers like Allianz to review whether the profit they amass from stake holdings is worth the regulatory capital they are required to hold.

 

Apollo will propose an offer to the OLB shareholders’ for an additional 10%, while the price it is paying Allianz represents 14.30 euros per share, compared with OLB’s closing price of 18.30 euros per share.