Zurich Financial Services (ZFS) has completed the second major part of its restructuring with the announcement that it had reached agreement with Germany’s Deutsche Bank (DB) to trade an estimated $2.5 billion worth of assets.
In exchange for transfering its 80 percent ownership of U.S -based Zurich Scudder Investments to DB, ZFS will receive a 75.9 percent in German insurer Deutscher Herold, estimated value around $1.3 billion, full ownership of asset manager Bonnfinanz, and DB’s life insurance subsidiaries in Italy, Spain and Portugal, also valued at $1.3 billion.
The move, coupled with the soon to be completed spin-off of Converium, ZFS reinsurance units (See IJ Website Nov. 20), is worth around $4 billion, enabling it to reduce its debt load and strengthen its reserves. it will also better position ZFS in markets where its seeking to expand, the U.S. and Europe.
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