Groupama, France's largest customer-owned insurer, plans to make „significant” purchases to grow abroad before proceeding with an initial share sale.
„We don't need to be on the market to finance future acquisitions,” said Groupama CEO Jean Azema during the presentation of the company's 2007-2009 business plan in Paris yesterday. „First we want to expand abroad, then we will hold an IPO. This way, shareholders will be able to benefit from synergies deriving from the purchase.” Azema, who said the company considered buying Credit Suisse Group's Winterthur unit before it was sold to bigger rival Axa SA, is looking for „one or more” purchases and wants to grow in central and eastern European countries such as Serbia.
Groupama, which also wants to expand in France, will be growing in China and may look for opportunities in Russia as well. „We want to develop our presence in countries where we are present already,” including Italy, Spain, the UK and Hungary, said Jean-Francois Lemoux, head of Groupama's international development. „We also want to become a major actor on new markets.” He didn't rule out acquisitions in „more mature markets” such as the UK Groupama, an insurance group created in the 19th century to serve French farmers, expects revenue to rise on average 7% each year through 2009.
Excluding further acquisitions, revenue from international operations will probably increase by about 14% annually in the period, Lemoux said. The company, which has holdings in Societe Generale SA and in Italy's Mediobanca SpA, doesn't plan to keep its stake in French reinsurer Scor in the long term, said Azema. „We don't have a vocation to keep a stake in a reinsurance company eternally,” he said. Azema had previously said an initial public offering would have helped Groupama pay for acquisitions in stock. (Bloomberg)