According to local daily Ziarul Financiar, the sale of insurer Asiban could come at a price of over € 100m. Three banks, BCR, BRD-GSG, and BT, each with a 25% stake, have decided to sell the company. The daily cited the general manager of the insurer, who indicated that consulting firms may be expected to value Asiban at 70-80% of its turnover, given its significant levels of cash and reserves. The gross underwritten premiums of Asiban were € 128m in 2006 and the company targets an improvement to € 160m in 2007. The company’s gross profit was € 1.4m in 2006.
Our view: Assuming the indicative valuation of Asiban to be reasonable, the shareholders of the company stand to make a significant capital gain. A 25% stake was booked at RON 27m by BRD-GSG at the end of 2006 and presumably the stakes of BCR and BT are held at similar levels, though disclosure was unavailable. The implied capital gain is some RON 55m for each of the holders. The news may have a positive trading impact today, clearly more material for BT and to a lesser extent BRD-GSG, than for Erste Bank.