The government has signed a memorandum of understanding with Vienna Insurance Group (VIG) on acquiring stakes in insurers Aegon Biztosító and Union Biztosító, Finance Minister Mihály Varga said on Thursday.
If negotiations close successfully, the state could acquire a 45% stake in the two insurers, Varga said. In a press release issued late on Wednesday, VIG said it had reached an agreement with the government of Hungary “on the principles of a cooperation and the further course of action, which provides for a participation of 45% by the Hungarian state” in the Hungarian Aegon companies and Union Biztosító. “The structure of the cooperation, which entails the controlling stake of and the operational management by VIG, is subject to further negotiations,” VIG said. “As a next step, VIG and Hungary will negotiate the participation and governance structure, will obtain the necessary board resolutions, and will apply for the approvals that are necessary for the implementation of the transaction,” VIG added. VIG, which owns Union Biztosító, announced in November 2020 that it agreed to acquire the businesses of Dutch peer Aegon in Hungary, Poland, Romania and Turkey for a price of 830 million euros, a deal that would have made VIG market leader in Hungary.
In April 2021, VIG said its acquisition of Aegon’s business in Hungary was denied by the interior ministry. Under state-of-emergency powers vested by parliament, Hungary’s government has been equipped with legal tools to block foreign takeovers of domestic companies. In October, the European Commission said it opened a probe into the interior ministry’s veto of the transaction because of a possible violation of the European Union’s merger regulation.