ACE Limited (NYSE: ACE) announced today that it has reached a definitive agreement to acquire ABA Seguros in Mexico from Ally Financial Inc. for approximately $865 million in cash.
Established in 1958, ABA Seguros is Mexico’s sixth-largest property and casualty (P&C) insurer and provides auto, homeowners and small business coverages. Based in Monterrey, the company has over 30 sales offices throughout Mexico and distributes its products through a network of nearly 2,000 independent agents as well as through auto dealerships, banks and direct channels.
“ABA Seguros is a highly regarded franchise in the Mexican P&C market with a terrific brand and an impressive and profitable track record,” said Evan Greenberg, Chairman and Chief Executive Officer, ACE Limited. “ACE has been operating in Mexico for many years through ACE Seguros, a business with an industrial commercial and personal accident focus. Following our announcement last month to acquire Fianzas Monterrey, the second largest surety writer in Mexico, and now ABA, a major personal lines and agency company, we are extremely well positioned to take advantage of the many growth opportunities we believe will occur in this important country over the next decade and beyond. We expect the acquisition of ABA Seguros to be accretive to earnings in the first year and to meet or exceed our company’s long-term return on equity target by the third year.”
The transaction is expected to be completed during the first half of 2013 and is subject to regulatory approvals.The ACE Group is one of the world’s largest multiline property and casualty insurers. With operations in 53 countries, ACE provides commercial and personal property and casualty insurance, personal accident and supplemental health insurance, reinsurance and life insurance to a diverse group of clients. ACE Limited, the parent company of the ACE Group, is listed on the New York Stock Exchange (NYSE: ACE) and is a component of the S&P 500 index. Additional information can be found at: www.acegroup.com. Cautionary Statement Regarding Forward-Looking Statements: All forward-looking statements made in this press release, related to the acquisition of ABA Seguros or otherwise, reflect ACE’s current views with respect to future events, business transactions and business performance and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements involve risks and uncertainties, which may cause actual results to differ materially from those set forth in these statements. For example, ACE’s forward-looking statements related to ABA Seguros and the anticipated acquisition (including the statement regarding impact on earnings and return on equity) could prove incorrect if the transaction were to not close, if ABA Seguros and its subsidiaries were to perform differently than currently expected by ACE or if anticipated expense-related efficiencies are not realized. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the dates on which they are made. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.