Zurich Insurance Group’s $409 Million Acquisition of QBE’s Latin American Operations

Willkie represented Zurich in the deal

Zurich Insurance Group has entered into an agreement to acquire the operations of Australian insurer QBE Insurance Group Limited (QBE) in Latin America for a total aggregate price of USD 409 million subject to closing adjustments. The transaction, which is subject to regulatory approvals, will position Zurich as the leading insurer in Argentina, while also adding incremental scale and capabilities in Brazil, Colombia and Mexico and making the Group the number three insurer in Ecuador.

The acquired operations had combined gross written premiums of about USD 790 million in 2017, with a highly diversified product offering and strong distribution.

Argentina represents around 50% of the acquired operations. The transaction will approximately double Zurich’s property and casualty (P&C) business in Argentina and create the leading insurance franchise in the country across the P&C and life businesses with 8.4% market share and the third-largest stand-alone P&C business with a similar market share. The acquired operations complement Zurich’s existing businesses in Argentina and add additional distribution and product capabilities particularly among small and medium sized commercial customers.

In Brazil, Colombia and Mexico, the Group will gain a range of incremental capabilities and access to additional distribution channels, and in Ecuador the acquired business ranks third in the country.

Zurich expects to achieve an overall return on investment comfortably in excess of the Group’s indicated hurdle rate of 10% within the first full year post completion of the transaction. The acquisition is expected to be completed by the end of 2018 and is expected to be funded from internal resources.

Willkie represented Zurich with a team including Thomas Cerabino (Picture), Maria-Leticia Ossa Daza, Jordan Messinger, Spencer Simon, Richard Reinhold, Donald Henderson Jr., Elizabeth Bannigan, Sarah Wong, Richard Hevier, Alexander Swartwood, Guy Inbar, Rose Ohanesian and Anna Martini Pereira.

Involved fees earner: Thomas Cerabino – Willkie Farr & Gallagher; Maria-Leticia Ossa Daza – Willkie Farr & Gallagher; Donald Henderson, Jr. – Willkie Farr & Gallagher; Elizabeth Bannigan – Willkie Farr & Gallagher; Richard Hevier – Willkie Farr & Gallagher; Jordan Messinger – Willkie Farr & Gallagher; Rose Ohanesian – Willkie Farr & Gallagher; Spencer Simon – Willkie Farr & Gallagher; Richard Reinhold – Willkie Farr & Gallagher; Guy Inbar – Willkie Farr & Gallagher;

Law Firms: Willkie Farr & Gallagher;

Clients: Zurich Insurance Group;


Author: Ambrogio Visconti