The UNIQA Group has signed an agreement on the acquisition of 20% of the shares of Vitosha, the sixth largest Bulgarian insurance company, with the financial investor EQUEST, the insurance company's indirect majority owner. Simultaneously, the acquisition offuture further stakes in Vitosha’s share capital has also been agreed with EQUEST, giving Uniqa a majority stake. In addition, it has been agreed that UNIQA may appoint the majority of the company's officers immediately after this acquisition. UNIQA will thus support Vitosha’s development with know-how from the start and will also manage the company. The transaction still requires an approval of the authorities concerned. The parties agreed not to disclose the purchase price. With the acquisition of this interest in the Vitosha Group, the UNIQA Group is extending its presence in South-Eastern Europe and is now represented in 13 European countries besides its domestic market in Austria, where UNIQA is market leader.

UNIQA CEO Konstantin Klien comments, “Bulgaria, after Romania, Bosnia and Herzegovina, and Slovenia, is now the fourth new market that we are penetrating this year. As in the other cases, this step was also carefully considered and preceded by a meticulous scrutiny and analysis of the market. As one of the new candidates for EU membership, Bulgaria had been on our strategic map for quite a long time. With Vitosha and EQUEST, we have found partners that are going to allow us a promising entry into a market with great potential, consistent with our company strategy. At the same time, we have also created a platform and the pre-condition for expanding to Bulgaria the successful partnership with the Raiffeisen bank group that already exists in Austria and other Eastern-European countries.”

EQUEST Managing partners George Krumov, Kari Haataja and Petri Karjalainen comment, “We are delighted to enter into a strategic partnership with UNIQA in respect of our investment in Vitosha. EQUEST has a core strategy for creating strong partnerships in its investments with leading global players and with UNIQA as the leading insurance company for the region we feel strongly that we will be successful in our future developments for Vitosha. This transaction will furthermore provide the management, employees and customers of Vitosha a platform for new insurance products and long term investment in building the company into one of the leading players in the Bulgarian insurance market.”

Vitosha
ZPD Vitosha, the non-life insurance company, like its subsidiary, ZK Vitosha Life AD, that is engaged in life insurance, was founded in 1992 as a private company. Together, the two companies achieved a premium volume of around€ 23.2 million in 2004, and thus a market share of 5.4%. With a market share or 5.5% in non-life insurance, Vitosha occupies fifth place. As far as the general market situation is concerned, Vitosha’s portfolio involves a great share of motor insurance, while the life business, with its above-average growth, is still under-represented with some € 2.5 million turnover.

Vitosha Insurance’s head office is located in Sofia.Sales and customer service are carried out via a well developed, Bulgaria-wide network of approximately 100 branches, brokers and agents. Vitosha has a staff of over 360.

EQUEST
EQUEST is an investment advisory and management company based in London with a core focus on the growing South East European markets and has a regional investment office in Sofia. The company advises and manages EQUEST Investments Bulgaria Limited (EIBL) an investment company listed on Irish and Vienna Stock Exchange with a EUR 135m market capitalization. EQUEST is one of the leading financial investors into Bulgaria’s growing economy and is principally focusing on consumer led sectors and opportunities including financial services, retail and real estate development. EQUEST shareholders comprise of leading institutional investors from Europe and US. EQUEST is authorized and regulated by the Financial Services Authority (FSA) in the United Kingdom.

Bulgarian insurance market
The 32 insurance companies in Bulgaria – 11 of these being life-insurers – achieved a premium volume of € 426 million (+25% increase on 2003) in 2004.  However, life insurance currently accounts for only about 12% of the premium volume. Experts expect a continued annual premium growth of approximately 25% until 2007. The share of insurance premiums in the gross domestic product – around 1.9% - is significantly below the EU 15 average of 5.7%. Considering the slight degree of insurance penetration in Bulgaria, the increasing standard of living and constant economic growth, great potential for growth exists in the insurance business, especially in life insurance.