Generali targeting European small, medium insurers

(Reuters) — Italy’s biggest insurer, Assicurazioni Generali SpA, is looking at small and medium-size insurance companies in Europe to strengthen its presence in the region, it said on Tuesday.

Generali said in November it had up to €4 billion ($4.5 billion) for acquisitions and growth with a focus on asset management and other higher margin businesses, but Chief Executive Philippe Donnet said he did not see big mergers in Europe in the insurance sector.

“We have capital and cash for acquisitions ... we will look at opportunities in a very selective way to increase earnings per share and create value for shareholders,” Mr. Donnet, who has been CEO since 2016, said at a shareholder meeting.

Generali in the past was rumored to be a potential target for larger rivals such as French insurer Axa SA or the Swiss Zurich Insurance Group Ltd.

The insurer, whose biggest shareholder is Italian financial group Mediobanca, is 28.5% owned by Italian investors.

Mr. Donnet, reappointed CEO on Tuesday for another three years, said small and medium insurance companies in central and eastern Europe could be targets since they were struggling with complex regulation and a need to diversify their businesses.

“Earnings from the asset management business must grow, also through acquisitions,” he added.

In the past three years Generali has raised €1.5 billion from disposals, exiting a dozen nonstrategic countries. It has also raised €1.9 billion from the sale of its German life insurance unit Generali Leben.

“We completed our disposals plan. Nothing else is on the table. If opportunities creating value for our shareholders arise, we will consider them,” Mr. Donnet said.