Toronto-based Fairfax Financial Holdings Ltd. announced on Tuesday that it will acquire New York-based American International Group Inc.’s (AIG) insurance operations in Argentina, Chile, Colombia, Uruguay, Venezuela and Turkey.
In addition, Fairfax has entered into an agreement to buy certain assets and renewal rights with respect to the portfolio of local business written by AIG Europe in Bulgaria, Czech Republic, Hungary, Poland, Romania and Slovakia.
The acquisitions will expand Fairfax’s footprint in Latin America significantly and builds on the company’s current expansion in Eastern Europe, which will accelerate plans for long-term growth in the latter region, says Prem Watsa, chairman and CEO of Fairfax, in a statement.
Fairfax currently has Latin American operations in Brazil and Central and Eastern European operations in Poland, Hungary, Czech Republic, Slovakia and Romania.
Total consideration for the acquisition is approximately US$240 million. Each transaction is subject to customary closing conditions, including relevant regulatory approvals, and each transaction is expected to close in 2017.
“AIG’s multinational clients will continue to experience the same seamless servicing capabilities following the transaction,” states the announcement. “The local country operations will maintain the same expertise, processes and efficiencies that have supported these clients, while Fairfax and AIG are mutually committed to meeting the needs of multinational clients going forward.”
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