General insurance provider AXA has agreed to acquire 50% shareholding in Chinese property & casualty insurer Tian Ping Auto Insurance Company (Tian Ping), for a total consideration of €485m.
As part of Ambition AXA strategy, the deal will allow the acquirer to further strengthen its position in direct as well as in high growth markets.
AXA will purchase 33% of the company from Tian Ping's current shareholders for RMB1.9bn (€237m) and subscribe to a dedicated capital increase for RMB2bn (€248m) to support future growth.
AXA chairman and CEO Henri de Castries said that the deal will provide the company with direct distribution capabilities in the fast-growing P&C insurance market in China.
Combined with the successful life insurance joint-venture ICBC-AXA, this operation confirms AXA's strategic focus and presence in the Chinese market, Castries added.
Following completion of the transaction, the acquirer and Tian Ping's current shareholders will jointly control Tian Ping, while AXA's existing Chinese P&C operations will be combined within the new joint-venture.
Subject to customary closing conditions, the transaction is yet to receive the approval of the China Insurance Regulatory Commission.
Primarily focusing on motor insurance business, Tian Ping has property & casualty licenses as well as a direct distribution license to operate in most Chinese provinces.
Founded in December 2004 and headquartered in Shanghai, Tian Ping manages 62 branches in 18 provinces in China, employs more than 5,000 staff and offers insurance services to more than 4 million clients.
Operating in 57 nations, AXA Group has a work force of 160,000 employees and serves 102 million customers and had €1.11 trillion in assets under management as of 31 December 2012.
