Astra-Uniqa will contribute 3.5 million euros (11.2 million RON) to the share capital increase of Generali, an insurance company in which it owns around 16%.
In total, the increase is worth 22 million euros (70 million RON), with the rest of the money being contributed by Generali Holding Vienna, which owns 83.6% in the company.
"We have already announced our intention to participate in the capital increase. We have been Generali shareholders since the company was established and it is an important investment for Astra. We want to retain our stake," stated Radu Mustatea, general manager of Astra-Uniqa.
Astra's stake in Generali is unparalleled on the domestic market, considering no other insurance company owns a stake in a rival company.
In 2003, the Austrians at Generali Holding Vienna attempted to buy Astra out of their Romanian company, but the two parties failed to agree on a price. Negotiations lasted for several months and, according to Generali's then manager, Gugliemo Frinzi, Astra was asking too much for its shares.
Generali Asigurari's capital is expected to reach around 38 million euros (120 million RON) after this increase. The 22 million euros that the Generali shareholders will contribute will be invested in the development of the company, says Tudor Moldovan, the general manager of Generali.
"We will devise a plan of operations for next year and then decide on how the money is to be utilised," stated Moldovan. Part of the funds could be used to cover the loss the company reported in 2006, worth approximately 8.8 million euros (31 million RON).
Astra-Uniqa is controlled by the Austrian group Uniqa (50%) and by businessman Dan Adamescu (47%). It is listed on the RASDAQ market of the Bucharest Stock Exchange and has a 190 million-euro (601 million RON) capitalisation.
Astra was the seventh leading player on the insurance market last year, only one place ahead of Generali, which was ranked eighth. Both companies operate on the general and life insurance segments.
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