The U.K.’s Royal & Sun Alliance Insurance Group plc announced that it has agreed to sell its 51 percent stake in its Chilean life subsidiary, Compania de Seguros de Vida La Construccion, S.A., to La Camara Chilena de la Construccion, the current 49 percent shareholder.
The bulletin said R&SA expects to receive around £44 million ($74 million), to be paid in cash. It indicated that as of Dec. 31, 2002 the net asset value of its share in La Construccion, “on a UK GAAP basis,” was approximately £54 million ($90 million), and the “consolidated profit contribution for the first nine months of 2003 was £4.5 million ($7.6 million).”
R&SA’s CEO of International Businesses, Simon Lee, stated: “La Construccion has been a successful business venture for the Group over the years, but given our increasing focus on general insurance we believe that it is now appropriate to withdraw from the business and for the company to revert to local ownership. I wish every success to the management and employees of La Construccion, and to our former joint venture partner in its role as sole owner of the business.”
R&SA said it would use the proceeds from the sale “to support its ongoing general insurance businesses. It also said it has “agreed to purchase the 30 percent shareholding of La Camara in Royal & Sun Alliance Vida of Peru, their other joint venture, for around £2m (US$3m), subject to regulatory approval.”
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