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Cattolica sells its shareholdings in Lombarda Vita to UBI Banca at a price approx. between € 290 and € 300 million

Cattolica sells its shareholdings in Lombarda Vita to UBI Banca at a price approx. between € 290 and € 300 million
23 December 2020 - Time: 17:35

Verona, 23 December 2020. Cattolica Assicurazioni informs that today it has signed a binding agreement with UBI Banca concerning the early termination of the life bancassurance agreements in place between the parties, which were supposed to end on 30 June 2021. For this purpose, the bank will exercise a call option on the 60% of Lombarda Vita’s share capital, held by Cattolica.

Cattolica will be entitled to a consideration in a range between approximately € 290 and € 300 million based on the IAS / IFRS 2020 result of Lombarda Vita. The operation is subject to the release of the necessary authorizations by the competent authorities.

Upon completion of the transaction (expected in April 2021), UBI Banca will pay Cattolica the price net of the amount of the loan currently in place between UBI Banca and Cattolica, equal to approx. € 80 million; the balance will subsequently be paid to Cattolica at the same time as the repayment of the loan itself (expected for the month of September 2021 and in any case subject to obtaining the necessary authorizations from IVASS).

It is expected that the Cattolica Group, following the completion of the transaction, will benefit from an IAS / IFRS capital gain of between approximately € 100 and € 110 million in the consolidated financial statements of 2021, while the capital gain on Cattolica's statutory financial statements will be between approximately € 50 and € 60 million. The expected impact on the Group's Solvency II ratio is slightly negative (for about -5 percentage points), assuming the repayment of the aforementioned loan.

In 2019 Lombarda Vita had collected premiums for € 1,365 million, the operating result was € 68 million, while IFRS profit (after tax) was € 47 million. At 30 September 2020, the premiums collected (first nine months of 2020) were € 948 million, the operating result was € 53 million, the IFRS profit of € 37 million, while the shareholders' equity was € 320 million and actuarial reserves at € 7.9 billion (all reported values are 100%).

Cattolica Assicurazioni was assisted in the transaction for the legal aspects by the "Molinari e Associati" firm and by the "Avv. Prof. Mario Cera" firm.