AlfaStrakhovanie Trade Credits will transfer the portfolio to its parent organization AlfaStrakhovanie
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One of the largest insurers, AlfaStrakhovanie, plans to fully integrate the recently acquired Atradius Rus Credit Insurance, which specializes in the risk of non-payment on trade loans. According to experts, in the future the subsidiary may be liquidated – this will reduce costs while maintaining competencies. At the same time, the business of Atradius, which was a subsidiary of a foreign group, could be based on contracts with foreign companies that left Russia. That is, AlfaStrakhovanie will have to develop its portfolio independently.
AlfaStrakhovanie Trade Credits (formerly Atradius Rus Credit Insurance) will transfer the portfolio to its parent organization AlfaStrakhovanie. The insurer posted the corresponding notice on the Central Bank website on October 10. The company called the procedure part of the implementation of an integration project to optimize business.
In July, AlfaStrakhovanie announced the completion of the acquisition of 100% of Atradius Rus Credit Insurance, a subsidiary of the international Atradius group. She specializes in protecting businesses from the risk of non-payment of trade loans.
General Director of AlfaStrakhovanie Vladimir Skvortsov then explained that the company sees prospects in the development of trade credit insurance and is going to retain the team, competencies and key business processes in the acquired company (see. “Kommersant” from July 20).
At the end of 2022, AlfaStrakhovanie Group ranked fifth in Russia in terms of fees (RUB 111 billion), follows from the data of “Expert RA”. AlfaStrakhovanie’s services are used by more than 31 million people and over 125 thousand enterprises. Atradius Rus Credit Insurance at the end of 2022 ranked 46th in terms of collections (more than 2 billion rubles).
According to experts, the next step could be the surrender of the license to a subsidiary company. Portfolio transfer followed by liquidation is a common practice for completing mergers and acquisitions in cases where the buyer either already has similar insurance products in its portfolio or has a license and the necessary resources to offer them, explains B1 partner Tatyana Samsonova.
Integration of the subsidiary is designed to reduce the insurer’s costs, experts note – savings can reach up to 30% by optimizing the wage fund while reducing business volumes and redistributing resources to growing insurance segments.
In the case of AlfaStrakhovanie Trade Credits, it is more difficult to take advantage of the benefits of a separate company, and the legal requirements for authorized capital and own funds must be met, notes Alexander Tsyganov, a professor at the Financial University under the Government of the Russian Federation.
According to Mr. Tsyganov, today the personnel, technology, as well as “all or the remaining part” of the clients of the former Atradius Rus can easily be integrated directly into AlfaStrakhovanie. Regblok chief analyst Anna Avakimyan adds that the integration of the company can increase opportunities for cross-selling of AlfaStrakhovanie.
At the same time, Alexander Tsyganov talks about the difficulties with “understanding the development of credit insurance in the near future.” Due to the departure of some insurers from the Russian market – primarily representatives of foreign businesses who were insured in a subsidiary of an insurer working with their founders, the volume of the portfolio should have decreased, the expert explains. According to Anna Avakimyan’s estimates, the subsidiary’s portfolio could be 7–12 billion rubles.
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