Allianz - Acquisition of Yapi Kredi Sigorta

Allianz Acquisition of
Yapi Kredi Sigorta
Dieter Wemmer,
Chief Financial Officer
Conference call
March 27, 2013
Transaction overview
Allianz and Yapi Kredi Bank enter into a long-term partnership:
 Allianz acquires Non-Life and Life & Pensions businesses of Yapi Kredi Bank in Turkey
 Allianz and Yapi Kredi Bank enter into a 15-year exclusive bank distribution agreement
 Yapi Kredi Bank retains 20% of the Life & Pensions business
Total net consideration to Yapi Kredi Bank of TRY 1,602mn (EUR 684mn1):
 Payment TRY 1,790mn (EUR 764mn1) for 93.9% stake in Yapi Kredi Sigorta netted
against a retention of 20% in Yapi Kredi Emiklilik by Yapi Kredi Bank for TRY 188mn (EUR 80mn1)
EPS accretive
P/E 2013e ~16 (before synergies)
© Allianz SE 2013
Closing expected 2H 2013 subject to regulatory and competition board approval
Mandatory tender offer for remaining 6.1% to be launched shortly after closing
1) Based on current FX rate (2.3425)
2
Turkey – favorable demographics and
sound economic fundamentals
Population ranked 18th in world
Real GDP
Fastest growing economy
in Europe (2002 – 2011)
All figures
in %
Brazil
Source: EIU
4.5
5.1
4.3
0.1
-0.1
5.1
3.8
5.2
1.0
31
24
32
0.9
23
23
53
35
0.3
16
6.4
Population
< age 30
0.9
88
6.5
77%
Population growth
2012 – 2016F
40
66
3.5
2.7
Russia
Government
debt/GDP
0.7
1.5
Malaysia
Thailand
Real GDP
2012 – 2016F
~ 75mn
Thereof urban
2.5
3.1
Indonesia
Population
5.4%
8.6
CEE
Eurozone
> 50%
Real GDP growth
2011
Turkey
CAGR
51
44
1.3
-0.2
46
© Allianz SE 2013
Strong growth indicators
37
0.8
35
3
Turkish insurance market –
fast growth and low penetration
All figures Non-Life CAGR
2006 – 2011
in %
Turkey
Life CAGR
2006 – 2011
14
12
Market size
(2011, USD bn)
10.1
Life premiums to GDP (%)
1.2% of GDP
-0.5
0.0
Russia
0.5
CEE
7
Eurozone
6
43.9
10
1,065
2
Brazil
15
16
Indonesia
27
18
78.3
14.1
Serbia Romania
1.0
Croatia
1.5
2.0
Turkey
Bulgaria
Hungary
Brazil
Czech R.
Slovenia
Indonesia
Poland
2.5
Thailand
3.0
Malaysia
3.5
Russia
Thailand
14
19
17
13
16
14.3
43.3
4.0
(As of 2010)
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
Non-Life premiums to GDP (%)
15.2
 Double digit growth rates, above CEE &
Europe and on par with growth markets
Sources: Swiss Re Sigma, BMI Forecast
4.0
4.5
© Allianz SE 2013
25
Malaysia
 One of the least penetrated
insurance markets
4
Combining two strong players (1)
Yapi Kredi Sigorta
Key figures1 2012
Allianz gains market leadership
Market position
Market position
# 3 in Non-Life market
# 5 in Non-Life market
#10 in Life market
# 4 in Life market
# 7 in Pension market
# 3 in Pension market
Statutory premiums
Statutory premiums
 Non-Life:
EUR 625mn
 Life:
EUR 39mn
 Pension (AuM):
EUR 303mn
Shareholders’ equity: EUR 241mn
Net income:
Pro-forma market position
# 1 in Non-Life market
# 3 in Life market
# 2 in Pension market
EUR 30mn
~ 1.4mn customers
1) Turkish GAAP
2) Dividend from L&P company is excluded from Non-Life net income
Source: annual reports and Insurance Association of Turkey
 Non-Life:
EUR 531mn
 Life:
EUR 90mn
 Pension (AuM):
EUR 1.5bn
Shareholders’ equity:
EUR 178mn
Net income2:
EUR 45mn
© Allianz SE 2013
Allianz Turkey
Key figures1 2012
~ 2mn customers
5
Combining two strong players (2)
(EUR mn)
GPW
CAGR
+12.5%
466
430
Non-Life
Life
664
499
483
324
281
43
625
36
37
36
39
2009
2010
2011
2012
-8.2%-p
102.2
99.2
99.2
2009
2010
2011
9M 2012
19
CAGR
+13.2%
23
14
14
7
5
2009
2010
Non-Life
Life
2009
Combined ratio
107.4
21
CAGR
+24.2%
519
Net income
Non-Life
Life & Pensions
GPW
536
Combined ratio
(%)
Yapi Kredi Sigorta – key figures 20121
(%)
4
2011
435
380
416
55
74
90
2010
2011
2012
112.3
104.4
100.6
101.7
2009
2010
2011
9M 2012
CAGR
+328%
33
30
26
1
4
2012
Non-Life
Life & Pensions
531
-10.6%-p
Net income2
19
620
490
9
-9
2009
1) Turkish GAAP; fully consolidated
2) Dividend from L&P company is excluded from Non-Life net income figures
Source: annual reports and Insurance Association of Turkey; underlying FX rate: 2.1620 (2009), 1.9969 (2010), 2.3373 (2011), 2.3134 (2012)
19
8
11
18
2010
2011
45
17
© Allianz SE 2013
Allianz Turkey – key figures 20121
15
27
2012
6
Combining two strong players (3)
(9M 2012, in EUR mn)
Loss-maker 
-181
Profit-maker 
(44)
23
(24)
19
(21)
16
(21)
14
(18)
104
Loss-maker 
Yapı Kredi
Allianz
12
(17)
11
-44
Profit-maker 
30
(8)
26
(8)
20
(6)
14
(4)
2
9
(4)
2
8
(3)
0
8
(2)
0
(2)
0
(10)
1) Source: annual reports and Insurance Association of Turkey; including dividends from subsidiaries
Yapi Kredi
15
(6)
10
(6)
200
42
(13)
4
(11)
Other
Life & Pensions market net income, local1
6
© Allianz SE 2013
Non-Life market net income, local1
Allianz
4
8
Other
7
Combining two strong players (4)
1 New bancassurance partner
Yapi Kredi Bank
2 Expansion of agencies by 80%
 5th largest banking network
 928 branches
 6.5 million active customers
 Highest share in credit cards and
auto loans (~17%)
Allianz
Non-Life
Life&Pensions
Yapi Kredi
1,406
1,129
125
171
 Bancassurance focuses on
Life & Pensions
 Agencies focus on Non-Life
and Health
 High reputation with powerful brand
 Low overlap
 Nationwide network
Agencies benefit from hardening motor
market and growth opportunities in
Health in light of rising household incomes
© Allianz SE 2013
Bank distribution prerequisite to
participate in fast growing pension
market supported by new pension reform
8
Transaction details
Yapi Kredi organizational chart
UniCredit
50%
Koç
Financial Services
50%
Koç
81.8%
18.2%
Free float
6.1%
Yapı Kredi
Bank
Free float
Yapi Kredi Bank
buys 20%
93.9%
 Allianz will acquire 93.9%
in Yapi Kredi Sigorta
(Non-Life)
99.99%
(Life&Pensions)
 Remaining 6.1% with the
subject to a mandatory
tender offer of Allianz
© Allianz SE 2013
15-year
bancassurance
agreement
 Yapi Kredi Bank will retain a
20% stake in Yapi Kredi Emeklilik
9
Disclaimer
These assessments are, as always, subject to the disclaimer provided below.
Forward-looking statements
The statements contained herein may include prospects, statements of
extent of credit defaults, (vii) interest rate levels, (viii) currency exchange
future expectations and other forward-looking statements that are based
rates including the Euro/U.S. Dollar exchange rate, (ix) changes in laws and
on management's current views and assumptions and involve known and
regulations, including tax regulations, (x) the impact of acquisitions, including
unknown risks and uncertainties. Actual results, performance or events
related integration issues, and reorganization measures, and (xi) general
may differ materially from those expressed or implied in such forward-
competitive factors, in each case on a local, regional, national and/or global
looking statements.
basis. Many of these factors may be more likely to occur, or more
Such deviations may arise due to, without limitation, (i) changes of the
pronounced, as a result of terrorist activities and their consequences.
general economic conditions and competitive situation, particularly in the
Allianz Group's core business and core markets, (ii) performance of financial
No duty to update
cy and severity of insured loss events, including from natural catastrophes,
The company assumes no obligation to update any information or forward-
and the development of loss expenses, (iv) mortality and morbidity levels and
looking statement contained herein, save for any information required
trends, (v) persistency levels, (vi) particularly in the banking business, the
to be disclosed by law.
© Allianz SE 2013
markets (particularly market volatility, liquidity and credit events) (iii) frequen-
10