Spain’s Caixabank buys Bankia’s insurance activities from Mapfre

The logos of Caixabank and Bankia are pictured in front of a branch of Caixabank in Madrid, Spain on November 10, 2021. REUTERS / Susana Vera

MADRID, Dec.29 (Reuters) – Spanish insurer Mapfre (MAP.MC) said on Wednesday it had sold its stake in Bankia’s insurance business to Caixabank (CABK.MC) in a $ 571 million deal euros ($ 645.12 million), although he has started arbitrage that could increase the value.

Caixabank, which bought Bankia in March, agreed to pay € 324m for Mapfre’s 51% stake in life insurer Bankia Vida, on top of the 49% it held.

It will also pay € 247 million to terminate a non-life insurance distribution contract, the two companies said in separate documents to the Madrid stock exchange regulator.

The combined amount represents 110% of the value of the two companies assessed by an independent advisor, but Mapfre said it has opened arbitration proceedings to demand that Caixabank pay 120% of the value.

“The parties will submit additional compensation of up to 52 million euros to arbitration proceedings,” Mapfre said in a statement.

Mapfre said the deal would generate a profit of € 171 million which it will use to improve efficiency in Spain and Italy.

Caixabank did not foresee any significant impact on its accounts in 2021 from the transaction, adding that the 49% stake in the life insurance business contributed 29 million euros in the nine months of 2021 that it was under the control of Caixabank.

He said his acquisition of Bankia for $ 4.3 billion was aimed at increasing profitability and reducing costs.

($ 1 = 0.8851 euro)

Reporting by Inti Landauro; Editing by Nathan Allen and Barbara Lewis

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