ERGO Group, one of the major insurance groups in Germany and Europe, has announced the signing of a shareholder’s agreement and capital increase agreement to make a strategic investment in Taishan Property & Casualty Insurance, a Shandong-based nationwide general insurer in China.
After completing the transaction, ERGO Group will obtain 24.9% equity interests of Taishan Insurance via its subsidiary ERGO Versicherung.
The deal marks a significant step by the leading German insurer to deepen and expand its services in the Chinese market.
Dr Markus Riess, CEO and chairman of ERGO Group, said in a statement, “In our global portfolio, China holds a central role.” He added, “Taishan Insurance is a dynamic and ambitious insurance company in the Chinese P&C market, which drives its business with great competence and determination. We are looking forward to building a strong partnership together and to bundling our strengths in this important market.”
Mr Jurgen Schmitz, CEO of ERGO China, said, ”ERGO Group’s strategic investment into Taishan Insurance is a strong entry point into China’s P&C market that also complements our existing life and health businesses in China. Through this investment, ERGO Group has the opportunity to share our insurance expertise and global resources with Taishan Insurance and to boost our innovative capabilities and competitiveness in the Chinese market.”
Zhang Bin, director of Shandong State-owned Assets Supervision and Administration Commission, said, “The strategic investment by ERGO Group will maximise resources from both sides to further drive Taishan’s development in the areas of competitiveness, innovation and risk control, and contribute to the high-quality economic development of Shandong Province.”
The involvement of ERGO Group will enhance Taishan’s market offering as China’s financial services sector continues to open up.
Incorporated in 2011, the Shandong-based Taishan Insurance provides insurance products, services and solutions to customers throughout China. In May 2020, Fitch officially confirmed BBB+ rating for Taishan Insurance with stable outlook, which ranks top among Chinese domestic insurance companies of similar type and size.
For nearly two decades, ERGO Group has made China an increasingly important part of its business strategy. As early as 2005, ERGO Group launched its travel assistance and health TPA service company in China, and in 2013, it established ERGO China Life, its life insurance joint venture with Shandong State-owned Asset Investment Holdings. ERGO Group accelerated its investment in China in 2019 by establishing its regional headquarters, ERGO China, which manages its existing activities and builds new business initiatives by launching a partnership with Great Wall Motors to provide the customers with state-of-the-art solutions powered by big data technology.
The deal with Taishan Insurance is subject to approval by relevant authorities.