After having paid almost half a billion euros for Asiban, BT Asigurari and OTP Garancia, French firm Groupama is preparing for another spectacular move: the merger of the three insurers.
Groupama had announced it would use a single brand on the Romanian market as early as this spring, but it was only recently that the firm started to assess the companies and prepare for the merger.
The French firm plans to bring the three insurers under the name of Groupama, not very well known domestically, and Asiban, BT Asigurari and OTP Garancia will disappear. While OTP Garancia is a little known brand because of the small size of the company, Asiban and BT Asigurari have a history behind. Asiban has seen strong turnover growth in recent years and last year reached gross underwritten premiums worth almost 167 million euros, ranking fourth on a 2.15bn-euro market.
BT Asigurari has also grown rapidly and reached turnover worth 82 million euros in 2007, with the price the French company paid last December for the company standing at 100 million euros.
The transformation of Groupama's three companies into one will slash operating costs in the future and give the French firm a uniform image in its relationship with customers. The emerging player will also have a strong foothold on the market, with a share of around 12% considering the three insurers' 2007 results. This means Groupama could rank third on the market, after Allianz-Tiriac and Omniasig. The merger, estimated to last for one year, could erode the French firm's market share, though, because three companies usually gain more customers than one. This is why Vienna Insurance Group, for instance, which owns five insurance firms, Omniasig, Asirom, Omniasig Life, BCR Asigurari and BCR Asigurari de Viata, has decided to embrace a multibrand strategy and keep the name of all owned companies.
The merge
