Colombian insurance and risk management company Suramericana, a unit of Grupo Sura, said Tuesday it signed an agreement to acquire London-based RSA Insurance Group’s Latin American operations for 403 million pounds (about $620.2 million).
RSA Latin America is a pan-regional insurance platform, which carries out operations in Chile, Mexico, Colombia, Uruguay, Brazil and Argentina.
“This is the largest remaining dispoal we have under way and is consistent with our stated target to substantially complete RSA’s strategic refocus by the 2015 year-end results”, said Chief Executive Stephen Hester.
RSA has sold off another large chunk of its overseas arm ahead of its impending takeover by its Swiss rival Zurich for £5.6 billion.
“This transaction is not conditional on the outcome of their possible offer for RSA”, the company said.
RSA said in a brief statement it has indicated to Zurich it would be willing to recommend an offer at this level to shareholders and the two are now in talks to discuss a deal.
“We remain disciplined in our price negotiations, above all regarding our return target”, a Zurich spokeswoman said in an emailed statement.
Analysts at Bernstein, meanwhile, said the deal proceeds would improve RSA’s balance sheet, cutting the cash Zurich would need to spend to manage the funding needs of RSA’s £7 billion [$10.75 billion] pension scheme.
The business was sold at a premium to its £258m in net assets.
“In Suramericana we have an experienced and committed regional player who can make the business a much more central part of their strategy”, added Mr Hester.
At 1355 GMT, RSA shares were up 0.8 percent at 507.5 pence [$7.79], slightly underperforming a rise in the FTSE 100 Index.