By Ulrike Dauer
FRANKFURT--Owners of German primary insurer Provinzial Nordwest
Holding AG will decide in the next two weeks whether to put the
company up for sale, which would open bidding to commercial
insurers like Allianz SE (ALV.XE).
The owners will decide "very soon" whether to sell the company,
"and if so, on what terms," a spokesman for one of the co-owners
said Wednesday. Three of the four owners have scheduled meetings in
the next two weeks, so a decision can be expected before the
Christmas holidays, said several people close to the matter.
The decision will be widely watched amid fears that a sale and
subsequent restructuring could cost thousands of jobs.
Financial Times Deutschland reported last week that Allianz has
made an offer for the regional insurer. According to FTD, Allianz
is offering at least 2.25 billion euros ($2.94 billion), equivalent
to Provinzial's book value, and Allianz's chief executive recently
met the insurer's three main owners to discuss the offer. An
Allianz spokesman declined to comment Wednesday.
Labor union Verdi estimates about 6,000 jobs could be at risk if
the company were sold to Allianz.
Provinzial, which operates in northern and western Germany, is
40% owned by the savings banks in Westphalia-Lippe; the regional
authority, or Landschaftsverband, of Westphalia-Lippe owns another
40%; the savings banks in Schleswig-Holstein own 18%; and the
eastern German savings banks own the remaining 2%.
On Tuesday, the three main owners met at the Provinzial Nordwest
headquarters in the northern German city of Muenster. After the
meeting, they stated "that there's interest on the part of
insurers" in buying Provinzial.
Verdi demands that Provinzial's supervisory board hold an
extraordinary meeting before Christmas and its owners "immediately
stop all considerations to sell the insurer to the private sector,"
said Frank Fassin, who heads Verdi's regional financial
institutions group and is a member of Provinzial's supervisory
board.
Provinzial, which has property/casualty and life insurance
operations, had gross premium revenue of around EUR3.04 billion and
booked a net profit of EUR116.2 million last year. It employs 2,960
people.
Last week, co-owner Landschaftsverband said it isn't planning to
sell its 40% stake and a sale would need the approval of all
shareholders.
Regardless of the outcome, discussions on Provinzial's future
should step up consolidation pressure among all 11 German insurers
still owned by the public sector, people familiar with the matter
say.
Write to Ulrike Dauer at ulrike.dauer@wsj.com
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