MARKET RELEASE
26 February 2018
QBE ANNOUNCES THE SALE OF LATIN AMERICAN OPERATIONS1
QBE has entered into agreements with Zurich Insurance Group (Zurich) for the sale of its operations in Argentina, Brazil, Colombia, Ecuador and Mexico. QBE Puerto Rico will be retained by QBE to facilitate the servicing of claims resulting from Hurricane Maria and will become part of QBE's North American Operations.
The estimated aggregate consideration is $409M subject to closing adjustments.
Profit on sale before tax is estimated at around $100M2.
The sale will positively impact the Group's APRA PCA multiple and S&P capital position due to the profit on sale, lower risk charges and the disposal of approximately $42M of goodwill and intangible assets.
The transactions are subject to regulatory approvals in each jurisdiction and are expected to close by the end of 2018.
QBE Group CEO, Pat Regan, said: "The decision to exit Latin America is consistent with our focus on simplifying the Group, reducing risk and improving the consistency of our results. Following a detailed review of our Latin American Operations, we determined that QBE was no longer the best strategic owner of these businesses. Zurich has a significant presence in Latin America and a strong commitment to the region. Following the completion of the sale, we look forward to cooperating with Zurich to service the needs of our multinational customers operating in Latin America."
1 All figures in US$ unless otherwise stated.
2 Excludes a foreign currency translation reserve reclassification charge of around $210M (out of equity and into the income statement). This is a non-cash item and will not impact shareholders' funds or QBE's regulatory or ratings agency capital base.
- ENDS -
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MARKET RELEASE | |
26 February 2018 | |
For further information, please contact: | |
Investor Relations | QBE Insurance Group Limited |
Group Head of Investor Relations | ABN 28 008 485 014 |
Tony Jackson | 8 Chifley Square |
Tel: +61 (2) 9375 4364 | SYDNEY NSW 2000 |
investor.relations@qbe.com | Australia |
Media Enquiries | www.qbe.com |
David Symons | |
Cell: +61 (0) 410 559 184 | |
Email:david.symons@qbe.com |
QBE Insurance Group Limited is listed on the Australian Securities Exchange, is one of the top 20 global insurance and reinsurance companies as measured by net earned premium and has operations in 36 countries.
IMPORTANT DISCLAIMER
Any forward-looking statements assume large individual risk and catastrophe claims do not exceed the significant allowance in our business plans; no overall reduction in premium rates in excess of business plans; no significant fall in equity markets and interest rates; no major movement in budgeted foreign exchange rates; no material change to key inflation and economic growth forecasts; recoveries from our strong reinsurance panel; no significant asset sales and no substantial change in regulation. Should one or more of these assumptions prove incorrect, actual results may differ materially from the expectations described in this market release.
QBE Insurance Group Ltd. published this content on 26 February 2018 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 25 February 2018 21:46:00 UTC.
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