Premium Income Rises at Allianz – Eyes U.K. Acquisition

November 27, 2000

German insurance giant Allianz AG announced that premium income for the first 9 months of the year reached a record €50.9 billion ($42.675 billion) a 15.5 percent rise over 1999. Property and casualty operations reported an 8.1 percent rise to €29.1 billion ($24.4 billion).

The company is on target to achieve its goal of a 10 percent rise in income for the full year, due in large part to increases in its life and health business,aggressive expansion in Central and Eastern Europe, and the growth of its asset management business, particularly in the U.S., following its purchase of California based fund manager PIMCO last May.

Even without the added boost that a proposed restructuring in German capital gains tax rates would give it, Allianz is in a good position to seek further expansion, and reports indicate that it is looking at the U.K. market.

According to the BBC and the Financial Times, Detlev Brenkamp, a member of the Allianz Board of Management, told the Evening Standard newspaper that his company “would not exclude” either CGNU or Royal & Sun Alliance as possible acquisitions.

Both CGNU, the U.K.’s largest general insurer, and RSA have substantial life insurance business, which is ” a top priority,” according to Brenkamp.

Allianz, by some measurements the world’s largest insurance company, is already among the top five U.K. life insurers, and top five p/c insurers through its ownership of Cornhill Plc. An acquisition of this size would make it an even more formidable competitor in both the U.K. and global markets.

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