NN Group goes on acquisition spree with €889m trio of deals in Europe

Dutch insurer  NN Group is looking to bolster its position in attractive European growth markets by acquiring profitable businesses and creating synergies. The company has confirmed three new deals in Greece, Poland and The Netherlands that it hopes will add scale, provide growth opportunities and drive diversification in life and protection in markets with low insurance penetration rates.

NN Group is acquiring MetLife’s business activities in Poland and Greece for a total consideration of €584 million. The acquisition will strengthen its position in life and pensions in Poland, while creating a market leading insurance company in Greece.

The deal will almost double NN’s customer base in Poland, the largest market in Central and Eastern Europe. In Greece, the transaction will make NN a leading life insurance company, with a combined 31 percent market share in life and health, and an 18 percent overall market share. NN in Greece will further diversify its distribution platform by adding broker and direct channels. It will also expand its accident & health portfolio in the country.

The acquisition is expected to create synergies and to lead to an incremental operating capital generation of €50 million per annum in 2024, NN said.

The transaction will be financed by a combination of cash capital at holding and around €100 million of local surplus capital. It is expected to close in the first half of 2022, subject to obtaining the necessary regulatory and competition clearances.

The company has also reached an agreement with Qmulus Invest B.V. and AS Holding B.V. to acquire a 70 percent stake in Dutch insurance broker and service provider Heinenoord, for a total consideration of €176 million. In addition, NN will refinance the outstanding debt granted to Heinenoord for an amount of €129 million.

Heinenoord is one of the largest insurance brokers and service providers in the Dutch insurance market, offering amongst others policy administration, underwriting services and claims handling. The company is active as a broker and mandated agent for a wide variety of non-life insurance products and insurers, servicing both the SME and retail market. Heinenoord is also a service provider for a network of around 500 independent brokers.

The company’s contribution to NN’s operating capital generation is expected to be approximately €25 million per annum in 2023 and is expected to grow significantly in the coming years.

At closing, NN will recognise a financial liability of approximately €85 million in connection with the optional acquisition of the remaining 30 percent of shares.

David Knibbe, CEO of NN Group, said: "Strategically and financially this is a unique opportunity for NN to enhance value and consolidate our leading positions in these markets.

"Having built our NN business in Greece since 1980 and in Poland since 1994, we know and understand these markets well. MetLife’s activities tie in well with ours, with a cultural fit and a mirrored business model, allowing for a smooth integration. While combining the strengths of both companies, we will continue to focus on the well-being of both our new and existing customers. We look forward to welcome around 2.7 million new customers and 450 new colleagues to our company, and to work together with around 1,600 additional (tied) agents and brokers."

Knibbe added: "Heinenoord plays an active role in the value chain between customers, traditional brokers and insurance companies, this acquisition will strengthen our distribution capabilities, and reinforce our leading position in the Dutch non-life market. NN is committed to continuing Heinenoord’s successful strategy to grow to a top 5 position in the Netherlands. Heinenoord will retain its independent position as a broker, and will remain dedicated to servicing its long-standing customer relationships and partnerships."

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