The group of investors includes Efraim Naimer, former chief of TBI Financial Services, and Constantin Toma, head of Omniasig insurer, acquired four years ago from TBI Financial Services by Vienna Insurance Group, market sources informed Business Standard.
“I am acquiring the shares of Clal Romania, and the strategy includes the transfer of the portfolio to other companies. I am the only investor involved in this transaction, which has not yet been finalized,” Naimer told Business Standard. Toma could not be contacted by the closing of this edition. According to the sale contract, the insurance policy portfolio will be taken over by Omniasig Vienna Insurance Group, said Clal officials. This change of shareholders will probably bring with it a renaming of the company, and significant changes in its development strategy. At the conclusion of this transaction, Clal Insurance will remain with some €3.6 million in losses, resulting from the difference between the company’s share capital and the amount received from buyers.
Other market sources have said that Clal’s acquisition does not necessarily mean a cash payment, as a complex mechanism involving a share trade and the takeover of certain debts will be used. Clal Romania’s General Manager, Valentin Tuca, told Business Standard that the subsidiary of the Israeli group would have reached the breakeven point in 2011, but that shareholders were unable to continue supporting the company’s development. According to figures published on the Clal Insurance website, the Israeli company ended 2008 with losses in excess of €100 mln, compared to a net profit worth €125 mln in 2007, due to turmoil on financial markets.
“The mother-company decided to withdraw from Romania, to consolidate its position on the Israeli market, while Clal Romania would have continued to require investments,” said Tuca. Clal Romania was founded in 2006, posting total losses of some €9 mln in the following two years. Players on the Romanian market are estimated to have registered losses from insurance activities of over €100 mln in 2008. These major losses forced shareholders to bring money from home, to support activity and maintain the solvency of subsidiaries. Shareholders invested some €250 mln in 2008, and capital increases in the insurance industry exceeded €100 mln in the first two months of 2009. “We registered a 20 percent annual increase in business in the first three months of 2009. On the commercial risk insurance segment we more than tripled our business,” Tuca added.
