Poland's state-run PZU agreed to buy Lietuvos Draudimas as part of a larger, 360-million euro (USD 467 million) deal struck earlier this year which will see PZU take control of most of British insurer RSA's eastern European operations.
"PZU agrees to decrease PZU's business in Lithuania, specifically in MOD (motor own damage) and property insurance, product groups where the Lithuanian Competition Council envisages possible competition concerns," it said. Motor own damage is a voluntary form of insurance and covers damage to policyholders' own cars, regardless of who is guilty.
The group said it had presented the antitrust watchdog with possible structures for a sale and added it would start looking for a buyer after being given the green light. It expects to receive permission before Oct 10.
"But it takes time as is usual for complex business transactions," PZU said in its statement, adding similar deals could take two years to complete.
Under the broader RSA deal, PZU also bought Latvian rival AAS Balta, an Estonian unit of RSA's Danish insurer Codan Forsikring, and Poland's Link4. It already has regulatory clearance for AAS Balta and Link4 takeovers. Read the full story Insurer PZU agrees to slim down in LITHUANIA to seal RSA deal