Ljubljana/Maribor, 01 April (STA) - Slovenia's top insurer Zavarovalnica Triglav has changed its mind on the sale of its 25.6% stake in the Abanka Vipa bank, announcing it would hire a consultant to help it with the sale. CEO Matjaz Rakovec said that the insurer was eyeing joining other owners who have already launched a sale.
The insurer announced on Thursday that it had launched proceedings for the sale. "A final decision will be based on the offers - we have no intention of selling our investment in Abanka Vipa at any price," he said.
The move represents a U-turn for Zavarovalnica Triglav, which is the single-biggest shareholder in Slovenia's third-largest bank, after it rejected the possibility of joining the sale launched by a consortium led by the Sava conglomerate last November.
At the time it labelled Abanka a strategic investment and even went about trying to acquire an additional 6% from the HIT gaming group, a fellow state-owned company.
The change in Triglav's stance on its stake in Abanka comes after a decision from the Securities Market Agency late last year that the state owners of Abanka must publish a takeover bid for Abanka or reduce their stake to below 25%.
Rakovec explained for Friday's daily Vecer that the Basel III bank capital adequacy rules meant that cross-ownership between banks and insurance companies was almost impossible.
He said the insurer was now looking to reach agreement with the Sava-led consortium on the joint sale of over 75% of the insurer (the other sellers had together put 50.1% on sale).
Such a sale would most likely secure a higher price than the sale of 50%, Rakovec told the Maribor-based daily. He stressed that Triglav was not willing to sell at any price.
He added that a recent conclusion from the insurance watchdog that Triglav actually had sufficient capital to make minor increases in its Abanka interest meant that Triglav did not have to carry out the sale at all cost.
"But from a standpoint of due care and diligence, withdrawing from ownership has to be the most suitable option."
Rakovec pointed to a lack of a valuation of Abanka, saying that its decision to launch its sale by searching for a consultant even though the consortium by Sava had already hired Dutch-based ING to advise it on the sale was an attempt to get a second opinion.
Asked about how quickly Triglav thinks the sale could be carried out, Rakovec pointed to the role of price will have in this.
"If there was a good price offered, the transaction could be carried out relatively quickly; otherwise the sale could drag out."
Meanwhile, Rakovec voiced satisfaction with Zavarovalnica Triglav's results for 2010. The insurer made a net profit of EUR 26.6m, after reporting a loss only a year earlier.
The insurer has full oversight of the entire group and has improved risk management across all its subsidiaries, including those abroad, he said, adding that figures for the first three months of this year were also encouraging.