The Commission has cleared, under the EU Merger Regulation, the proposed acquisition of the insurance business of the Czech PPF Group N.V. by Assicurazioni Generali SpA of Italy. After examining the operation, the Commission concluded that the transaction would not significantly impede competition in the European Economic Area (EEA) or any substantial part of it.
Generali is the parent company of an international group of companies active worldwide in the insurance and financial sectors. Generali is primarily active in Italy but the group is also present in other EU countries. Recently, the Generali group opened offices in several Central and Eastern European countries.
PPF is the principal holding company of a financial group originating from the Czech Republic, and currently active in Central Europe, Central Asia, China and Vietnam. The group specialises in financial services for retail clients in insurance and consumer financing. PPF's insurance business is primarily carried out via the Czech ex-monopolist insurer Ceská pojištovna (CP), which is active in the Czech Republic, Slovakia, Russia, Cyprus and Ukraine.
The proposed transaction would combine PPF and Generali's insurance businesses from Central Europe to Central Asia in a newly created company, which would be solely controlled by Generali.
The Commission's examination of the proposed transaction showed that despite horizontal overlaps on the markets for life insurance and non-life insurance in the Czech Republic, the new entity would continue to face several strong, effective competitors with significant market shares in these markets. These competitors include branches and subsidiaries of established international insurance companies such as Allianz, ING, KBC, AXA and Wiener Städtische. Furthermore, the insurance markets in the Czech Republic are expected to grow further in the next years and the investigation did not reveal any significant barriers to either expansion of existing competitors or new entry of insurance companies from other EU countries.
The Commission also found that the transaction would not lead to concerns relating to the vertical relationship between Generali's assistance services and the merged entity's activities on the motor and travel insurance market, given Generali's relatively small market shares and the presence of several large competitors with significant positions in the assistance markets.
Competition concerns in the Slovak Republic could also be excluded in view of the minor overlaps between the parties' activities. [4 December 2007]