Zurich Completes Deal with Deutsche Bank

Zurich Financial Services (ZFS) has completed the second major part of its restructuring with the announcement that it had reached agreement with Germany’s Deutsche Bank (DB) to trade an estimated $2.5 billion worth of assets.

In exchange for transfering its 80 percent ownership of U.S -based Zurich Scudder Investments to DB, ZFS will receive a 75.9 percent in German insurer Deutscher Herold, estimated value around $1.3 billion, full ownership of asset manager Bonnfinanz, and DB’s life insurance subsidiaries in Italy, Spain and Portugal, also valued at $1.3 billion.

The move, coupled with the soon to be completed spin-off of Converium, ZFS reinsurance units (See IJ Website Nov. 20), is worth around $4 billion, enabling it to reduce its debt load and strengthen its reserves. it will also better position ZFS in markets where its seeking to expand, the U.S. and Europe.