Ageas Insurance International and BGL , which hold 50% each of the shares in Luxembourg Vie (FLV), have signed an agreement with Cardif, parent company of Cardif Lux International (CLI) to merge their activities.
The newly merged entity will distribute life and protection insurance products in the Luxembourg market. Ageas will detain 33.33%, BGL 33.33% and Cardif 33.34%. The merger includes an exclusive distribution agreement, giving the new entity access to the domestic clients of the BGL retail network in Luxembourg.
On a pro-forma basis, FY10 total assets under management of the new entity amounted to € 12bn. FY10, Luxembourg Vie recorded gross inflows of € 1.29bn and had € 7.7bn of AuM. Cardif Lux International recorded gross inflows of € 1.65bn and had € 4.5bn of AuM.
The new entity will continue to do business under the Cardif Lux International brand name.
Our View:
Ageas has a longstanding history of setting up joint-ventures with strong local distribution partners. In this case they are continuing with an enlarged joint-venture with . We don’t see a reason to make an adjustment to our current forecast.
Conclusion:
We remain Buying with an unchanged target at € 3.25.