SWITZERLAND - Credit Suisse has backed out of talks with Axa, France, over the sale Winterthur, the Swiss group's insurance business, after failing to receive an "adequate" price offer.
Credit Suisse and Axa had reportedly signed a memorandum of understanding as a first step in the sale talks but the group today announced it would hold onto Winterthur, Switzerland’s largest non-life insurer.
“At this point in time, the market is not prepared to pay an adequate price for what [Credit Suisse] believes is the full value of Winterthur,” the group said in a statement.
“Given the successful operational and financial turnaround of the insurance business, Credit Suisse Group is convinced that the best option for Winterthur is for it to move forward with its strategy of profitable growth in order to realise its full potential.
At a special investor event in Zurich today, Credit Suisse announced Winterthur’s profitability goal is to achieve sustainable net income of CHF1.2bn (e784.5m) or more in 2007.
The sale of the insurance unit had been estimated to generate more than e5bn.
“Based on its strong market presence and its own separate identity, Winterthur will continue to deliver improvements in its operating performance and further streamline and sharpen the focus of its business portfolio with the aim of preparing for a capital market flotation,” the group added.
In conjunction with the investor event, Credit Suisse announced plans to fully integrate its banking units over the next 18 months to two years and to create “distinct lines” of business dedicated to private clients, corporate and investment banking clients and asset management.
Investors, driven by depressed interest rates, slower global economic growth and rich equity market valuations are examining non-traditional investment opportunities.
The registration deadline for the Workplace Savings & Benefits Awards 2019 is today.
This week's top stories were the DWP giving the green light to CDC and TPR granting extensions for 11 master trust authorisation applications.
Susan Martin says building strong foundations for business are the only way forward as the pensions industry is radically shaken up