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Gerling, Swiss Re and NCM to form "Gerling NCM Credit and Finance AG", leading credit insurer worldwide
Cologne (ots) - Gerling Versicherungs-Beteiligungs-AG (GKB) and Swiss Re have reached an agreement on forming a joint venture between Dutch credit insurer NCM, in which Swiss Re has a 90 % stake, and the Gerling Credit Insurance Group. The new company "Gerling NCM Credit and Finance AG" is to be based in Cologne, and Gerling is to have a 51 % holding. Swiss Re will hold 25 % (+ 1 share) and a private group of investors will hold 24 % (- 1 share).
Gerling NCM will have a 25 % stake in the world credit insurance market and will boast premium income of some euro 1.1 bn. With its comprehensive product range for receivables management services, its international network and its position in major industrial countries, the new group is set to be the leading integrated credit insurer worldwide.
Following integration of the two companies, an IPO is envisaged in the medium term, though this will not affect stakes held in Cologne.
"In the new Gerling NCM Credit and Finance AG, the leading credit insurer worldwide will emerge in terms of internationality and innovation. Gerling Credit and NCM form an ideal joint venture, and the resulting synergies will benefit all stakeholders. Gerling customers worldwide will be offered the best available solutions and protection in an area of increasing concern for corporate risk managers. Thus the new company will further strengthen the Gerling Group as a whole", said Dr. Jürgen Zech, Chairman of the Executive Board and CEO of the Gerling Insurance Group.
The Chairman of the Executive Board at Gerling NCM will be Bernd H. Meyer, currently Chairman of the Gerling Credit Group. The Executive Board of the new company will be formed from the top management of the existing companies. Chairman of the company's Supervisory Board will be Dr. Jürgen Zech.
The Gerling Credit Insurance Group and the NCM Group are an excellent fit and will be able to take advantage of significant synergies:
- Where Gerling has leading positions in Germany, Belgium, France, Switzerland and Latin America, NCM is a market leader in the Netherlands, the UK and Scandinavia, and has a sound foothold in Italy and in the growing US market.
- With expanded regional presence, the information and risk portfolio as well as the marketing of classic product solutions, innovative financial products and services (e.g. securitization of receivables, factoring, forfaiting and collection) will be definitely optimized. One example is the increase in Gerling's product portfolio from factoring in France and Italy. NCM owns two factoring companies in Scandinavia. The opportunity to offer factoring at an international level will result in a competitive edge.
- Combining the two companies enhances their financial strength, optimizes the reinsurance structure and asset management, and extends the capital base.
NCM (Nederlandsche Credietverzekering Maatschappij) was established in 1925 and, until 1991, concentrated on commercial and export credit insurance, mainly for Dutch firms. Since 1932, it has been a state mandated insurer for export transactions, with political risks being reinsured by the state. Since 1991, NCM has been pursuing an expansion strategy, in which it has extended both its international network and its product range. Since 1998, Swiss Re has had a 90 % holding in NCM. ABN AMRO and ING Bank hold 5 % each. NCM, the fifth largest credit insurer worldwide, with 1,800 employees, along with the recently acquired Società Italiana Cauzioni (SIC), had a total revenue of euro 528 m in 2000. "NCM and Gerling Credit together will offer an enhanced value proposition to our clients, through specialist risk management capabilities and diversification," says Gerard van der Stelt, Chairman of the Executive Board at NCM.
Gerling Credit Insurance, a subsidiary of Gerling Versicherungs-Beteiligungs-AG, was formed in 1954 and has a market share of 13 %, making it the third largest credit insurer worldwide. In 1994, Belgium-based Namur - Assurances du Crédit was successfully integrated. With it, and with the subsidiaries acquired in the past five years - Étoile (France), Gerling Nordic and Mexican market leader Gerling Comesec - the entire Credit Insurance Group is now operating with 1,700 employees in 36 countries on all continents. In e-commerce the Gerling companies Trusted Shops, Trusted Trade and Trade Cover have launched new B2C and B2B products. In 2000, revenue totalled euro 608 m. "Our new company will be the integrated credit insurer with the most comprehensive global network. For the entire service chain of trade transactions we are offering comprehensive and modular solutions in risk transfer, financing and related services," says Bernd H. Meyer.
The Gerling Insurance Group operates in all areas of insurance and reinsurance. As one of the leading German insurers, the Group posted a premium income of euro 9.5 bn in 2000 with 12,600 employees. Dr. Rolf Gerling holds 70 % and Deutsche Bank 30 % in Gerling Versicherungs-Beteiligungs-AG.
The agreed joint venture requires the consent of the Dutch supervisory authorities and the European competition authority. The transaction is to be finalized by the end of the year.
JPMorgan acted as financial advisor and Shearman & Sterling as legal advisor to the Gerling Group of Insurance Companies.
ots Originaltext: Gerling Versicherungs-Beteiligungs-AG (GKB)
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