Suramericana, the insurance subsidiary of Columbia-based Grupo Sura, has agreed to buy pan-regional insurance platform, RSA Latin America.
RSA said the £403m ($621m, €555m) cash sale is expected to be “strongly accretive” to capital for the company, enhancing the flexibility of its core operations in the UK and Ireland, Scandinavia and Canada.
“This is the largest remaining disposal we have underway and is consistent with our stated target to substantially complete RSA’s strategic refocus by the 2015 year end results announcement,” said RSA group chief executive Stephen Hester.
“It has become increasingly clear to us that RSA is no longer the best strategic owner of these [Latin] businesses.”
“It has become increasingly clear to us that RSA is no longer the best strategic owner of these businesses"
He added: “In Suramericana we have an experienced and committed regional player who can make the business a much more central part of their strategy.”
Zurich Insurance was made aware of this sales process before it agreed to buy rival insurer RSA last month. This transaction is not conditional on the outcome of Zurich’s offer for RSA.
According to Bloomberg, Zurich Insurance has arranged £5.5m in financing for the acquisition of RSA.
Since RSA announced the sale of its Latin America business on Tuesday, its share price jumped by nearly 1.3%.
RSA Latin America has a presence in Chile, Argentina, Brazil, Mexico, Colombia and Uruguay.