Delta Lloyd NV today announces the sale of its German business to Nomura Holdings, Inc.
Delta Lloyd NV ("Delta Lloyd") today announces the sale of its German business to Nomura Holdings, Inc ("Nomura"). This is in line with Delta Lloyd's stated strategy to focus on its core markets, the Netherlands and Belgium, and follows Delta Lloyd's decision, announced on 4 March 2010, to place its German business in run-off and to cease writing new policies. On 4 August 2011, Delta Lloyd formally announced its intention to fully withdraw from the German market.
About the transaction
The transaction comprises the transfer of all the assets and liabilities of Delta Lloyd Lebensversicherung AG and the sale of all of Delta Lloyd Deutschland AG's shares in other German subsidiaries to Nomura. Those companies will continue to service all obligations to current policyholders and, to ensure a smooth transfer, will also take over all of Delta Lloyd's approximately 200 German staff, including its current management. The German business will likely benefit from the security provided by Nomura's published stronger than peer average tier one capital ratio of 16.2%.
The parties expect the transaction to close around mid 2012, subject to the receipt of all necessary regulatory approvals and other conditions.
The final transaction price is dependent on developments in the capital markets, related principally to interest rate and spread developments within the bond portfolio of the German activities, as well as the real estate portfolio.
The transaction is subject to a minimum price at closing. Delta Lloyd has the right to withdraw from the agreement if the minimum price is not achieved.
Based on that minimum price, and absent a significant drop in the value of the real estate portfolio, Delta Lloyd expects the transaction (including tax benefits) to result in a positive IFRS result of at least €65 million and an increase of group IGD solvency by around 12% (as at 30 June 2011). Total equity under IFRS of Delta Lloyd's German activities amounted to €206 million as of 30 June 2011.
Expected IGD solvency at end of September
Delta Lloyd expects its IGD solvency ratio at end of September 2011 to be within the target range of 160-175%, excluding the expected 12% uplift from the sale of the German activities mentioned above.
Thanks to risk management measures, the sensitivity to interest rate and equity price movements has declined compared with the disclosed figures for the first half of 2011. Delta Lloyd will provide further information in its Q3 trading update.
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For more information about this press release:
Delta Lloyd
Media relations
Martijn Donders
+ 31 (0)20 594 4488
Investor relations
Rozan Dekker
+ 31 (0)20 594 9693
Nomura
Oda von Dreising at Hering Schuppener
+ 49 (0)69 92 18 74 47
Notes to editors:
About Nomura
Nomura is a leading financial services group and the preeminent Asian-based investment bank with worldwide reach. Nomura provides a broad range of innovative solutions tailored to the specific requirements of individual, institutional, corporate and government clients through an international network in over 30 countries. Based in Tokyo and with regional headquarters in Hong Kong, London, and New York, Nomura employs over 27,000 staff worldwide. For the full year 2010/2011 Nomura reported global revenues of $13.7bn. Nomura’s Retail business has $853bn of client assets in custody and has $298bn of assets under management within its Asset Management business.
About Delta Lloyd Group
Delta Lloyd Group is a financial services provider offering life insurance, general insurance, asset management and banking products and services. Delta Lloyd Group’s target markets are the Netherlands and Belgium. The Group operates primarily under the brand names of Delta Lloyd, OHRA and ABN AMRO Insurance in the Netherlands, and under the Delta Lloyd brand name in Belgium. Delta Lloyd Group employs 5,515 permanent staff (FTE) and is listed on NYSE Euronext Amsterdam.
Important information
Certain statements contained in this press release that are not historical facts are "forward-looking statements". These forward-looking statements are based on management’s beliefs and projections and on information currently available to them.
These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond Delta Lloyd Group's control and all of which are based on management's current beliefs and expectations about future events.
Forward-looking statements involve inherent risks and uncertainties and speak only as of the date they are made. Delta Lloyd Group undertakes no duty to and will not update any of the forward-looking statements in light of new information or future events, except to the extent required by applicable law. A number of important factors could cause actual results or outcomes to differ materially from those expressed in any forward-looking statement as a result of risks and uncertainties facing Delta Lloyd Group and its subsidiaries.
Such risks, uncertainties and other important factors include, among others: (i) changes in the financial markets and general economic conditions, (ii) changes in competition from local, national and international companies, new entrants in the market and self-insurance and changes to the competitive landscape in which Delta Lloyd Group operates, (iii) the adoption of new, or changes to existing, laws and regulations, (iv) catastrophes and terrorist-related events, (v) default by third parties owing money, securities or other assets on their financial obligations, (vi) equity market losses, (vii) long- and/or short-term interest rate volatility, (viii) illiquidity of certain investment assets, (ix) flaws in underwriting assumptions, pricing and/or claims reserves, (x) the termination of or changes to relationships with principal intermediaries or partnerships, (xi) the unavailability and unaffordability of reinsurance, (xii) flaws in Delta Lloyd Group’s underwriting, operating controls or IT systems, or a failure to prevent fraud, (xiii) a downgrade (or potential downgrade) of Delta Lloyd Group’s credit ratings, (xiv) the outcome of pending, threatened or future litigation or investigations, and (xv) a conflict between Aviva and minority shareholders in Delta Lloyd Group.
Should one or more of these risks or uncertainties materialise, or should any underlying assumptions prove to be incorrect, Delta Lloyd Group 's actual financial condition or results of operations could differ materially from those described in this herein as anticipated, believed, estimated or expected.
Please refer to the Annual Report for the year ended 31 December 2010 for a description of certain important factors, risks and uncertainties that may affect Delta Lloyd Group’s businesses.