Matt Fairfield’s Exin is in talks with five reinsurers including Swiss Re and Munich Re to provide reinsurance financing to complete the agreed sale of Greece’s largest insurance company Ethniki, re-Insurance.com can reveal.
Industry entrepreneur Fairfield is in a race against time to complete the sale ahead of the 28 March deadline following a competitive tender process a year ago managed by Goldman Sachs and Morgan Stanley.
Although a price of EUR720mn for a 75 percent stake was agreed last summer, Exin’s ability to complete the sale was severely hampered by a dispute with his backer, the Greek-American billionaire John Calamos.
Last month, Calamos – and his investment firm Calamos Family Partners – issued proceedings both in the US and in the Netherlands demanding repayment of around $41.7mn in loans to Exin.
Exin has an exclusivity with Ethniki owner National Bank of Greece until the 28 March.
Exin – which is being advised by PwC and UBS – is exploring a reinsurance transaction of Ethniki’s back-year life book to assist with the financing. It is not believed to be Exin’s preferred option but depends upon whether it raises sufficient equity/debt from other sources within the next two weeks, which are thought to potentially include high net worth individuals and specialist investors.
Other reinsurers it has held talks with include Munich Re, Apollo Global’s Athora, a unit of Deutsche Bank and European Insurance Consolidation Group (EICG), a recently formed acquirer of life business.
Swiss Re is understood to be an existing reinsurer of Ethniki, which writes both life and non-life business.
Although Exin has had difficulty in raising the finance it has nonetheless been helped by the improvement in the valuation of Greek sovereign assets which are thought to have improved Ethniki’s net asset value by as much as EUR120mn. This is believed to accrue to Exin, together with Ethniki’s circa 2017 earnings of EUR75mn, if it is able to complete by the end of the month.
National Bank of Greece is mandated to sell Ethniki following the recapitalisation of its banks by the EU and the IMF following the Greek financial crisis. The sale will also assist in the next round of European bank stress tests that take place in May.
Exin declined to comment.