Dutch insurer NN to acquire 100% of ABN AMRO’s life insurance subsidiary

Dutch insurer  NN Group has agreed to acquire 100% of ABN AMRO Verzekeringen’s (AAV’s) life insurance subsidiary for a total consideration of €253 million.

AAV is a long-standing joint venture between NN Group (51%) and ABN AMRO Bank (49%) serving over a million retail and corporate customers.

As part of the deal, ABN AMRO Levensverzekering N.V. (AAL), the life insurance subsidiary of AAV, will be integrated into Nationale-Nederlanden Levensverzekering Maatschappij N.V. (NN Life & Pensions).

ABN AMRO Bank and NN Group have agreed to extend their cooperation in AAV by five years until 2038, if certain customary performance criteria are met.

Following the transaction, AAV will focus on its non-life insurance business and its insurance broker activities. NN Group and ABN AMRO Bank have agreed to make additional investments in the coming years to strengthen AAV’s digital capabilities and further grow its non-life portfolio.

The transaction will be financed from existing cash resources of NN Life & Pensions. AAV intends to distribute the proceeds, after deduction of costs related to the transaction, to its shareholders NN Group and ABN AMRO Bank.

NN expects the deal to have a limited negative impact on its Solvency II ratio on closing, which is expected to change into a limited positive impact following the envisaged legal merger of AAL and NN Life & Pensions and the application of NN Group’s Partial Internal Model. On a consolidated basis, the acquisition is expected to result in a net cash outflow from NN Group of €128 million for the indirect 49% stake in AAL and an increase of its dividend capacity of approximately €15 million per annum.

The deal is subject to regulatory approvals and is expected to close in the second half of 2022.

Leon van Riet, CEO Netherlands Life & Pensions and member of the Management Board of NN Group, said: "This transaction is in line with our strategy to achieve further efficiencies by leveraging our existing closed book capabilities. We are pleased to continue our successful collaboration with ABN AMRO Bank and look forward to further supporting AAV’s growth strategy in non-life insurance."

Frans van der Horst, acting chief commercial officer personal & business banking at ABN AMRO, noted: “Following this transaction, AAV will continue as a non-life insurer and intermediary, which is an important strategic step for AAV. AAV is well placed in the market combining expertise and suitable insurance products.”