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EBRD co-invests with new insurance sector fund to develop insurance and pensions in central and eastern Europe
In response to the increasing importance of the insurance and pensions sectors in central and eastern Europe, the European Bank for Reconstruction and Development (EBRD) will co-invest up to US$ 25 million (ECU 19.2 million) with New Europe Insurance Ventures (NEIV), a fund which will invest in small and medium-sized insurance companies in the region. The fund, to be established in Edinburgh, will have up to US$ 75 million (ECU 57.6 million) in capital.
"The EBRD's co-investment programme and NEIV will together provide the region's promising small and medium-sized insurance companies with a dedicated source of equity funding", said Serge Desprat, Head of the insurance unit in the EBRD's Financial Institutions team. "This transaction stresses the importance attached by the EBRD to the development of the insurance sector."
NEIV will be managed by Hodgson Martin Limited, a specialist investment management firm based in Edinburgh with specific expertise in investing in the insurance sector internationally. Institutions from the United States and Europe are expected to invest in NEIV through a private placement organised by Nomura International plc, European headquarters of the Nomura Securities Co., Ltd., the world's largest investment bank.
Allan Hodgson, Managing Director of Hodgson Martin Limited, said: "This co-investment programme offers valuable synergy between the EBRD's expertise in the region and our insurance industry experience."
NEIV's advisory committee will be composed of several individuals with long-standing expertise and sound reputation in the international insurance markets. Investment targets for NEIV will comprise unlisted entities, including start-up and existing ventures, as well as small and medium-sized privatisation candidates. The initial geographical focus of NEIV will be central Europe.
Participations in, or with, investment funds have become an increasingly efficient way for the EBRD to increase its own productivity while responding to its core market transition mandate.
To date, the EBRD has undertaken equity investments in seven insurance companies operating in its countries of operations.
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