“We are currently working on a project that includes the consolidation of insurance companies owned by government Lenders under the roof of Turkey Wealth Fund,” said a statement made by Turkey Wealth Fund. Güneş Sigorta and Halk Sigorta reported to the Public Disclosure Platform.
The full text of the press statement by TWF goes as follows:
““Within the scope of the New Economy Program, Ministry of Treasury and Finance has planned reforms for the insurance and pension market in order to develop the savings base of Turkish economy and non-bank financial industry. Insurance and Private Pension Supervision and Regulation Agency and Türk Reasürans A.Ş. have been founded within the scope of those reforms.”
“With the aim of executing those reforms, Turkey Wealth Fund is currently working on the project to consolidate insurance companies held by government lenders under the rood of TWF.”
Restructuring of insurance market
“Turkey ranks 19th in the world in terms of the size of its GDP, and 39th in terms of premium production. Global average of premium per capita stands at 682 USD as of 2018, whereas in developed markets, the figure rises as high as 3 thousand 737 USD. In Turkey, it is at 127 USD. Turkey ranks 65th among 88 countries in terms of annual direct premium per capita. Share of life group stands at around 13 percent in Turkey, which goes up to 54 percent for global average. These figures make it more visible that Turkey needs to take action for restructuring its insurance market.”
More efficient use of all distribution channels
“We expect that consolidation of all insurance companies owned by government lenders under a single roof will contribute to the creation of a scale economy, and bringing the size of our non-bank financial industry to the level of global averages. In this respect, we aim to increase the size of insurance and pension markets to become a part of global competition, to reduce costs by increasing operational efficiency, to use all distribution channels more efficiently – banks in particular, and to offer a wider product diversity.”
“TWF believes that Turkish insurance market will therefore reach an independent and dynamic structure, and its global competitive power would increase with the right structural steps. We attach great importance to this project and see it as a contribution to our missions of financing Turkey’s strategic investments and supporting the improvement and deepening of financial markets which are already defined in our roadmap.”
“Within the scope of the project, Development and Investment Bank of Turkey, KPMG Bağımsız Denetim ve Serbest Muhasebeci Mali Müşavirlik AŞ, and Esin Attorney Partnership serve as public consultants.
“We plan to complete the project in the first quarter of 2020, and will continue to share the developments with the public along the way.”
Güneş Sigorta submits a statement to PDP
According to a statement from Güneş Sigorta to Public Disclosure Platform; insurance, life and pension companies owned by state lenders will be consolidated under a single roof within the framework of the New Economy Program.
Full text of the statement goes as follows:
“Reforms to be made in the insurance, life and pension sector constitute a significant part of the planned structural reforms to be made within the framework of the New Economy Program announced by the Ministry of Treasury and Finance. After the foundation of Insurance and Private Pension Regulation and Supervision Agency and Türk Reasürans A.Ş., the reforms are anticipated to continue with the consolidation of insurance, life and pension companies held by government lenders under a single roof.
These reforms aim to make a contribution to the creation of a scale economy, bringing the size of our non-bank financial industry to the level of global averages, while increasing the size of insurance and pension markets to become a part of global competition. Moreover, the insurance market will have a more dynamic structure by increasing operational efficiency, decreasing costs, using all distribution channels more efficiently – banks in particular, offering a wider product diversity.
We hereby submit the details offered to us by our shareholders Türkiye Vakıflar Bankası TAO, Vakıfbank Personeli Özel Sosyal Güvenlik Hizmetleri Vakfı, and Türkiye Vakıflar Bankası TAO Memur ve Hizmetlileri Emekli ve Sağlık Yardım Sandığı Vakfı (“Sellers”) for public information:
We have been informed that our shareholders began negotiating with TWF for the acquisition of shares that are owned by the Sellers and represent 71.81 percent of our company’s capital by a company (“Buyer”) to be founded by Turkey Wealth Management (“TWF”).
In this respect;
During the transfer of our company shares to the Buyer, the Buyer shall acquire:
(i) Shares of Halk Sigorta AŞ that are owned by Türkiye Halk Bankası AŞ and Halk Yatırım Menkul Değerler AŞ
(ii) Shares of Ziraat Sigorta AŞ that are owned by T.C. Ziraat Bankası AŞ, Ziraat Katılım Bankası AŞ, Ziraat Yatırım Menkul Değerler AŞ, and Ziraat Teknoloji AŞ
(iii) Shares of Vakıf Emeklilik ve Hayat AŞ that are owned by our company, Vakıf Yatırım Menkul Değerler AŞ, Vakıfbank Personeli Özel Sosyal Güvenlik Hizmetleri Vakfı, and Türkiye Vakıflar Bankası TAO
(iv) Shares of Halk Hayat ve Emeklilik AŞ that are owned by Türkiye Halk Bankası AŞ
(v) Shares of Ziraat Hayat ve Emeklilik AŞ that are owned by T.C. Ziraat Bankası AŞ, Ziraat Katılım Bankası AŞ, Ziraat Yatırım Menkul Değerler AŞ, and Ziraat Teknoloji AŞ
(vi) Shares of Vakıf Emeklilik ve Hayat AŞ that belong to Vakıf Yatırım Menkul Değerler AŞ.
We have been informed that, following the completion of those transfers,
- Ziraat Sigorta AŞ, Halk Sigorta AŞ and our company shall be merged
- Halk Hayat ve Emeklilik AŞ, Ziraat Hayat ve Emeklilik AŞ, and Vakıf Emeklilik ve Hayat AŞ shall be merged.
In this respect, after the completion of necessary approvals and share transfers, general assemblies will make the decisions for the merging of these companies; which will be followed by the legal procedures and transactions. At that point, transfer prices to be considered for the share transfers and exchange rates to be considered for company mergers will be calculated according to the current legislation. Such costs, rates and conditions will be determined after the finalization of negotiations with the relevant parties and legal obligations; and will be disclosed with the public as deemed necessary by the legislation.
In accordance with the Article 8 of the Law 6741 on the Foundation of Turkey Wealth Fund Company and Amendment of Certain Laws (“Turkey Wealth Fund Law”); the 6362 Capital Market Law and secondary legislation put into force in accordance with this law, as well as the Law 4054 on the Protection of Competition shall not apply to Turkey Wealth Management Fund, Türkiye Varlık Fonu Yönetimi AŞ, and other companies to be founded by Türkiye Varlık Fonu Yönetimi AŞ. Therefore, the obligation regarding takeover bid in publicly held corporations which is stipulated in the Communiqué on Takeover Bids II-26.1 by the Capital Markets Board, shall not apply to this situation. Moreover, according to the Article 12, Provision 1(b) of the Communiqué on Common Principles Regarding Significant Transactions and the Retirement Right; the right to retirement shall not arise as a result of the merger of insurance companies.
We would strongly advise investors to examine the exceptions and exemptions stipulated by Turkey Wealth Management Law and other relevant legislation. During the entire process of executing the structural reforms for the insurance, life and pension markets; all the parties will act in accordance with the awareness of public responsibility, and the rights of both investors that own public shares in state-owned insurance companies and of employees working at state-owned insurance, life and pension companies shall be protected. Necessary actions shall be taken to ensure that none of the stakeholders suffer from any injustice as a result of such structural reforms, to the extent allowed by the current legislation.
The project is believed to make significant contribution to our country’s economy and is intended to be finalized at the earliest possibility. All the important details about the project will continue to be shared with the public.
We respectfully submit these details for public information.
We herewith declare that the abovementioned statement is in compliance with the principles listed in the Communique on Special Circumstances by the Capital Markets Board, completely reflects the information we have received, and that we have made all the necessary effort to get that information in its fullest and accurate form and are responsible from this statement we have shared with the public.”
Halk Sigorta also submitted a statement to the PDP about the transfer of insurance companies to TWF.
Full text of the statement goes as follows:
“Reforms to be made in the insurance, life and pension sector constitute a significant part of the planned structural reforms to be made within the framework of the New Economy Program announced by the Ministry of Treasury and Finance. After the foundation of Insurance and Private Pension Regulation and Supervision Agency and Türk Reasürans A.Ş., the reforms are anticipated to continue with the consolidation of insurance, life and pension companies owned by government lenders under a single roof.
These reforms aim to make a contribution to the creation of a scale economy, bringing the size of our non-bank financial industry to the level of global averages, while increasing the size of insurance and pension markets to become a part of global competition. Moreover, the insurance market will have a more dynamic structure by increasing operational efficiency, decreasing costs, using all distribution channels more efficiently – banks in particular, offering a wider product diversity.
Therefore, we began negotiating with TWF for the acquisition of 89.18 percent of shares that represent the capital of Halk Sigorta A.Ş and are owned by our Bank, and 100 percent of the shares that represent the capital of Halk Hayat ve Emeklilik A.Ş. by a company (“Buyer”) to be founded by Turkey Wealth Management (“TWF”).
According to the information gained within this respect;
• During the transfer of Halk Sigorta A.Ş and Halk Hayat ve Emeklilik A.Ş. shares to the Buyer,
The Buyer shall acquire:
(i) Shares of Güneş Sigorta A.Ş. that are owned by Türkiye Vakıflar Bankası T.A.O., Vakıfbank Personeli Özel Sosyal Güvenlik Hizmetleri Vakfı, and Türkiye Vakıflar Bankası T.A.O. Memur ve Hizmetlileri Emekli ve Sağlık Yardım Sandığı Vakfı,
(ii) Shares of Ziraat Sigorta A.Ş. that are owned by T.C. Ziraat Bankası A.Ş., Ziraat Katılım Bankası A.Ş., Ziraat Yatırım Menkul Değerler A.Ş., and Ziraat Teknoloji A.Ş.,
(iii) Shares of Vakıf Emeklilik ve Hayat A.Ş. that are owned by Güneş Sigorta A.Ş., Vakıf Yatırım Menkul Değerler A.Ş., Vakıfbank Personeli Özel Sosyal Güvenlik Hizmetleri Vakfı, and Türkiye Vakıflar Bankası T.A.O.,
(iv) Shares of Ziraat Hayat ve Emeklilik A.Ş. that are owned by T.C. Ziraat Bankası A.Ş., Ziraat Katılım Bankası A.Ş., Ziraat Yatırım Menkul Değerler A.Ş., and Ziraat Teknoloji A.Ş.,
(v) Shares of Vakıf Emeklilik ve Hayat A.Ş. that are owned by Vakıf Yatırım Menkul Değerler A.Ş,
• It has come to our understanding that, following the completion of those transfers, (a) Ziraat Sigorta AŞ, Halk Sigorta AŞ and our company shall be merged; and (b) Halk Hayat ve Emeklilik AŞ, Ziraat Hayat ve Emeklilik AŞ, and Vakıf Emeklilik ve Hayat A.Ş. shall be merged.
In this respect, after the completion of necessary approvals and share transfers, general assemblies will make the decisions for the merging of these companies; which will be followed by the legal procedures and transactions. At that point, transfer prices to be considered for the share transfers and exchange rates to be considered for company mergers will be calculated according to the current legislation. Such costs, rates and conditions will be determined after the finalization of negotiations with the relevant parties and legal obligations; and will be disclosed with the public as deemed necessary by the legislation.
In accordance with the Article 8 of the Law 6741 on the Foundation of Turkey Wealth Fund Company and Amendment of Certain Laws (“Turkey Wealth Fund Law”); the 6362 Capital Market Law and secondary legislation put into force in accordance with this law, as well as the Law 4054 on the Protection of Competition shall not apply to Turkey Wealth Management Fund, Türkiye Varlık Fonu Yönetimi AŞ, and other companies to be founded by Türkiye Varlık Fonu Yönetimi AŞ. Therefore, the obligation regarding takeover bid in publicly held corporations which is stipulated in the Communiqué on Takeover Bids II-26.1 by the Capital Markets Board, shall not apply to this situation. Moreover, according to the Article 12, Provision 1(b) of the Communiqué on Common Principles Regarding Significant Transactions and the Retirement Right; the right to retirement shall not arise as a result of the merger of insurance companies. We would strongly advise investors to examine the exceptions and exemptions stipulated by Turkey Wealth Management Law and other relevant legislation. During the entire process of executing the structural reforms for the insurance, life and pension markets; all the parties will act in accordance with the awareness of public responsibility, and the rights of both investors that own public shares in state-owned insurance companies and of employees working at state-owned insurance, life and pension companies shall be protected. Necessary actions shall be taken to ensure that none of the stakeholders suffer from any injustice as a result of such structural reforms, to the extent allowed by the current legislation.
The project is believed to make significant contribution to our country’s economy and is intended to be finalized at the earliest possibility. All the important details about the project will continue to be shared with the public.
We respectfully submit these details for public information.
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