Eureko Seals Deal for Poland’s PZU

Eureko, the Pan-European consortium of insurers, has reached agreement with the outgoing Polish government on terms to acquire an additional 21 percent stake in Powszechny Zaklad Upbezpieczen (PZU) for around $655 million.

The often acrimonious relationship between Eureko and the Polish government over the company’s 30 percent stake in PZU, and its management control agreement was initially resolved last April, but since then negotiations have been under way to set a price on the 21 percent of shares Eureko wanted to acquire.

Eureko had originally agreed to acquire the shares as part of an initial public offering, but when share prices for insurers dropped precipitously following the attacks on the U.S., it became unlikely that the IPO could be made this year. The parties therefore concluded a private sale agreement, based on the price prior to September 11.