Kardan N.V, the Israeli-owned investment group, sold 40 percent of Kardan Financial Services to Austrian insurance group Wiener Stadtische Allgemeine Versicherungsgesellschaft for EU112.6 million in a move to further access the financial markets in central and eastern Europe.
WS will invest EU105.6m of equity capital into KFS, in exchange for newly issued shares, and will purchase 4% of KFS from minority shareholders for EU7m.
Upon completion of both transactions, Amsterdam-based Kardan will hold 55% of the KFS shares, WS will hold 40% and the minority shareholders 5%. Kardan is expected to make a EU28m capital gain from the transaction. The proceeds from the sale will go towards paying off EU21.8m of KFS debt and increasing KFS' 58.18% holding in TBIH - a corporation that handles Kardan NV's financial activities in eastern Europe - through a capital increase of at least EU35m.
The latter is still subject to approval, including the agreement of TBIH minority shareholders.