Baku, Azerbaijan, Oct. 8
By Azad Hasanli - Trend:
American International Group Inc (AIG), a US-based insurance corporation, is holding talks to sell its subsidiary in Azerbaijan - the Chartis Azerbaijan, a source in the insurance market told Trend Oct. 8 on conditions of anonymity.
The source didn't elaborate on the negotiation process, only saying that the deal involves a complete sale of the subsidiary company.
Earlier, it was reported that AIG is considering two options, one of which is the sale of the 100-percent share in the subsidiary. In case if there is no sale, the subsidiary company will be closed.
The source said it doesn't matter whether the subsidiary will be handed over to a local or foreign investor.
The source said there is a potential buyer, with whom talks are being held, however both options, i.e. selling the company or closing it are still being considered.
The company currently does not conclude any new contracts, while the ones in effect were transferred to a number of other insurance companies in Azerbaijan, which are provided with reinsurance services by AIG.
AIG's subsidiary in Azerbaijan has always been very profitable and has never needed support from the parent company.
"The reason for the closure is that the Azerbaijani market is very small and it is unprofitable to have a subsidiary here. Along with that, the AIG will continue to support the Azerbaijani market through reinsurance," the source said.
The source said the incomplete contracts were transferred to other local companies, as the decision to leave was made over a year ago.
"These issues were agreed upon with customers. They found other insurers suiting them, and the contracts were transferred to them," the source said.
Between Jan.-Aug. 2014, the Chartis Azerbaijan collected 39,190 AZN with payments at only 339.52 AZN, according to stats from the State Insurance Supervision Service. A year earlier the company's insurance fees exceeded 684,540 AZN with payments at 390,810 AZN.
AIG (Chartis) is a major international organization engaged in the property and personal insurance (other than life insurance), serving over 40 million customers in more than 160 countries and jurisdictions.
There are 27 insurance companies and one reinsurance company in Azerbaijan.
The official exchange rate on Oct. 8 is 0.7843 AZN/USD.
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