PPF Group has agreed to sell one of its last assets in Russia. PPF Life Insurance, which offers life insurance in the Russian Federation and was one of the largest in the country in the last decade, sold it to the Dubai company Inweasta.
The information was brought by the Interfax agency. PPF Group did not want to comment on her. However, according to information from SZ Byznys, the agreement has been concluded and the deal should be settled by the end of November 2024.
It is the last significant asset PPF owns in Russia, and the sale completes the group’s declared exit from Russia.
The Czech group has been looking for a buyer for its insurance company in Russia for a year and a half, and the authorities have stopped the sale process several times. In the end, it was acquired by a company founded in Dubai by the Russian manager Andrej Mikhailovič Elinson in 2022. Elinson worked in the management of a number of Russian corporations, including the Alfa Group of oligarch Mikhail Fridman and the Ingostrach insurance company, which PPF co-owned in the past.
The transaction has already been approved by the Government’s Foreign Investment Control Commission and the Russian Central Bank.
“When assessing the prospects for the acquisition of the insurance company, we were guided by the current state of the industry, the prospects for its further development and the margins, which on average exceed 25 percent on the market,” he commented Elinson transaction, according to which the life insurance market in Russia is constantly growing – in 2023 the growth was 50 percent – and is the main engine of growth of the entire insurance market.
The PPF Group sold a 100% stake in the insurance company. According to the latest published data, PPF Life Insurance in 2021 had written premiums of approximately 1.4 billion crowns and reported a net profit of 300 million crowns.
Today’s PPF Life Insurance entered the Russian market as a subsidiary of Česká pojišťovna in 2002, and since then has tried to build the life insurance market practically from scratch. After PPF formed a joint holding with the Italian group Generali in 2008, the firm transformed itself into a general insurance company focusing on both life and non-life insurance.
Five years later, PPF sold its 49% stake in Generali PPF Holding to the Generali group in two steps, keeping the Russian life insurance company, which today operates under the name PPF Life Insurance, and non-life insurance, which it operated under the Home Credit brand.
PPF Group Sells Its Final Asset in Russia: What’s Next?
Well, well, well, here we are! The PPF Group has waved goodbye to its Russian life insurance arm, PPF Life Insurance, which has become a successful little player in the country’s market over the past decade. It seems that they’re packing their bags and leaving the vodka-soaked past behind to join the sands of Dubai. Yes, folks, a Dubai company called Inweasta has picked up the tab, and let’s face it, it’s not just a valuable asset; it’s the last significant piece of a puzzle that PPF has been trying to put away since… well, before Russia made the news for all the wrong reasons!
According to our friendly friends at the Interfax agency, PPF Group is keeping its lips sealed tight regarding this one—like a squirrel hiding its nuts! But don’t worry; we have sources 220% more reliable than your local pub gossip. SZ Byznys claims that the deal is locked in, and it should be wrapped up by the end of November 2024. **Mark those calendars, folks!** You might want to hang a pin in it for the next big ‘I told you so’ moment at the pub.
The Long Goodbye
This little venture marks the end of a chapter for PPF Group—one heck of a drawn-out chapter, mind you. They’ve been on the lookout for a buyer for their Russian insurance company for a staggering year and a half, which is longer than some relationships I’ve seen last! Add in a few bureaucratic roadblocks along the way, and well, it’s a miracle they didn’t lose their patience and take off for a nice beach holiday instead.
Finally, the stars aligned, and Inweasta—the brainchild of one Andrej Mikhailovič Elinson—scooped it up. Elinson has got his fingers in various pies; he’s part of the Russian management elite, having managed some heavyweight corporations, including the Alfa Group of oligarch Mikhail Fridman. So, if you’re thinking this transaction is just a walk in the park, think again. This guy’s wheeling and dealing as if he’s playing Monopoly with real money. And don’t go thinking that all is above board; the Russians have steaks in this, even if they’re not exactly kosher!
The Business of Insurance in Russia
According to the wise musings of Mr. Elinson—which sounds like a character from a murder mystery, doesn’t it?—the life insurance market in Russia is not just about surviving; it’s thriving! A 50% growth this year alone? That’s right! The Russians are getting into life insurance faster than they get into a banya. With margins exceeding 25%, one can only assume that life insurance salesmen there are not just selling policies but also dishing out gold bars with a side of caviar.
A Legacy on the Line
PPF Life Insurance, which started as a sprightly subsidiary of Česká pojišťovna back in 2002, has seen plenty of action – and I’m not just talking about the boardroom drama. With written premiums of around 1.4 billion crowns and net profits of 300 million crowns reported in 2021, it’s clear this little insurance company has had its heyday. They’ve been tackling the complexities of the Russian insurance market like a seasoned pro, trying to build it up from the ground. Talk about putting in the graft!
Oh, and by the way, PPF was not without its alliances. After a partnership with the Italian giant Generali in 2008 and selling its stake in Generali PPF Holding, PPF carried on with both life and non-life insurance. Essentially, they tried to juggle everything until they wanted to hand over the life insurance baton—possibly hoping someone else can run with it now!
Final Thoughts
As the dust settles on this high-profile exit, we can only wonder what will become of PPF. Will there be a grand return to Russia or a quiet retirement in some opulent Dubai resort? Keep your eyes peeled and your ears open, because one thing is for sure: in the world of business, the twists and turns are just as riveting as a good Netflix drama! So, grab your popcorn and stay tuned; you never know what might happen next!
In a significant strategic move, the PPF Group has finalized an agreement to divest one of its remaining assets in Russia, PPF Life Insurance, a leading player in the country’s life insurance sector for nearly a decade. The insurance company has been acquired by Inweasta, a Dubai-based firm founded by the notable Russian businessman Andrej Mikhailovič Elinson in 2022.
According to reports from the Interfax agency, PPF Group has opted to refrain from commenting on the transaction. However, sources from SZ Byznys indicate that the agreement has been successfully concluded, with the deal anticipated to be finalized by the end of November 2024.
This sale marks the exit of PPF Group from the Russian market, as PPF Life Insurance represents the last of the group’s significant assets in the country, following their strategic withdrawal plans.
Over the past eighteen months, the Czech group has actively sought a buyer for its Russian insurance business. The sale process faced multiple delays due to regulatory hurdles imposed by local authorities. Ultimately, the purchase was secured by Elinson, who has a wealth of experience in managing prominent Russian corporations, including roles within the Alfa Group, which is owned by well-known oligarch Mikhail Fridman, along with the Ingostrach insurance company previously co-owned by PPF.
The sale has received necessary approvals from the Government’s Foreign Investment Control Commission and the Russian Central Bank, paving the way for a smooth transition.
Elinson emphasized that the decision to acquire the insurance company was strategically driven by the robust growth prospects within the industry, noting that the life insurance market in Russia has been expanding consistently, with a remarkable 50 percent growth in 2023. He highlighted this sector as a crucial engine for the broader insurance market’s expansion, where profit margins typically surpass 25 percent.
The PPF Group has divested a complete 100% stake in PPF Life Insurance. Recent figures show that in 2021, the company reported written premiums of approximately 1.4 billion crowns, alongside a net profit of 300 million crowns.
Entering the Russian market in 2002 as a subsidiary of Česká pojišťovna, PPF Life Insurance embarked on an ambitious mission to cultivate the life insurance landscape from the ground up. A pivotal change occurred in 2008 when PPF established a joint holding with the Italian insurance giant Generali, rebranding itself as a general insurance entity catering to both life and non-life insurance needs.
In 2013, PPF further streamlined its operations by selling its 49% stake in Generali PPF Holding back to the Generali Group in a two-part transaction, while retaining ownership of the Russian life and non-life insurance firms still operating under PPF Life Insurance and the Home Credit brand, respectively.
CFIUS
Lfa Group and the Ingostrach insurance company, which was previously co-owned by PPF. Notably, the transaction has received the green light from the Government’s Foreign Investment Control Commission and the Russian Central Bank, clearing the path for a smooth transition.
Elinson expressed his optimistic outlook on the future of PPF Life Insurance, citing the robust growth trends within the Russian life insurance sector, which saw a remarkable 50% increase in 2023 alone. He highlighted that the market is not only flourishing but is also vital for the overall growth of the insurance industry in Russia, with average profit margins exceeding 25%.
PPF Life Insurance has a storied history, having entered the Russian market as a subsidiary of Česká pojišťovna in 2002. The company has played a significant role in developing the country’s life insurance market from its infancy. Following a partnership with the Italian firm Generali in 2008, PPF transformed into a comprehensive insurance provider. By 2021, the company reported impressive financials, including around 1.4 billion crowns in written premiums and a net profit of 300 million crowns.
This divestiture marks a significant milestone in PPF Group’s strategic exit from Russia, culminating years of seeking a viable path forward in a challenging regulatory and geopolitical landscape. The finalization of this deal could herald a new chapter not only for PPF Group but for the Russian insurance market as well, as new ownership may bring fresh strategies and opportunities for growth. As the ink dries on this transaction, industry observers will be eager to see how Inweasta, under Elinson’s leadership, will navigate the complexities and capitalize on the potential of the Russian insurance landscape.
