Home Uncategorized Barclays and CNP agree life insurance joint venture in Spain, Portugal and...

Barclays and CNP agree life insurance joint venture in Spain, Portugal and Italy

0 0

Barclays Bank PLC and CNP Assurances SA have agreed to establish a long-term life insurance joint venture in Spain, Portugal and Italy. As part of this transaction, Barclays will sell a 50 per cent stake in Barclays Vida y Pensiones Compañía de Seguros (‘BVP’), Barclays Iberian life insurance and pensions subsidiary, to CNP.

Barclays will also enter into a 25-year agreement with CNP for the marketing and distribution of life insurance and pension products through Barclays retail network in Spain, Portugal and Italy.

The transaction is conditional on, amongst other things, receipt of the necessary regulatory approvals and is expected to be completed this year.

CNP will pay Barclays an initial upfront consideration of €140 million in cash on completion. This is subject to a post-completion adjustment by reference to BVP’s net assets as at closing. An additional consideration of up to a maximum of €450 million will be payable to Barclays in cash over a period of 12 years, dependent upon the achievement of certain volume and margin thresholds and Barclays branch openings, to maintain a balanced sharing of the value created through the joint venture between the two shareholders.

Barclays intends to invest the proceeds from the sale in developing its businesses in Spain, Portugal and Italy. This joint venture will support Barclays growth in these countries, where the number of distribution points has already increased from approximately 600 in January 2007 to over 1,000 currently.

The strategic partnership with CNP will significantly enhance Barclays insurance offering to its retail customers in Spain, Portugal and Italy. CNP, one of the leading players in the European life insurance market, will have access to Barclays customers through its extensive distribution network in Spain, Portugal and Italy.

Leo Salom, Chief Executive of Barclays Global Retail and Commercial Banking – Western Europe, said: “Barclays joint venture with CNP presents an exciting opportunity for both businesses. Barclays is an ambitious player in the Spanish, Portuguese and Italian markets, and we are confident that CNP’s expertise in insurance product design and manufacture, coupled with the strength of Barclays brand and distribution network, will be a winning combination for our customers and shareholders.”

Gilles Benoist, Chief Executive Officer of CNP Assurances, said: “We are delighted to launch this partnership with such a highly-regarded bank as Barclays. CNP’s long-standing experience and expertise in life insurance, particularly in Southern Europe, combined with the growth capacity of Barclays in this region, will create long-term value for all parties. Moreover, this partnership refocuses and strengthens CNP’s footprint in the region, and will be a source of positive synergies.”