Bâloise Holding (BALN) M&A Announcement summary

Deal rationale and strategic fit

• The merger creates Helvetia Baloise, Switzerland's second-largest insurance group with a ~20% market share and a leading composite insurer in Europe, leveraging over 160 years of experience and complementary strengths.

• The combined group will be a top-10 European insurer, with strong positions in Switzerland, Germany, Belgium, Spain, and specialty markets, and a business volume of CHF 20 billion across 8 countries.

• The merger leverages cultural alignment, similar business models, and strategic goals, facilitating smooth integration and focused, yield-oriented growth.

• Enhanced scale enables larger IT investments, improved claims networks, and better data leverage for pricing and underwriting.

• Focus on unlocking value from complementary assets, including specialty markets and insurebanking, with a diversified portfolio supporting resilience and growth.

Financial terms and conditions

• Fixed exchange ratio of 1.0119 new Helvetia shares per Bâloise share, resulting in near 50/50 ownership (approx. 53% Helvetia / 47% Baloise), with 100% stock consideration.

• The new entity, Helvetia Baloise Holding Ltd, will be headquartered in Basel, listed on SIX Swiss Exchange under ticker "HBAN".

• Board will have 14 members (7 from each company); CEO: Fabian Rupprecht; Deputy CEO & Head of Integration: Michael Müller.

• Both companies will pay ordinary dividends for FY2024, subject to shareholder approval; Bâloise's share buyback program will not proceed if the merger is approved.

• Pro forma 2024 figures: CHF 20.2 billion total business volume, CHF 867 million net income, and CHF 7.3 billion shareholders' equity.

Synergies and expected cost savings

• Run-rate pre-tax cost synergies estimated at CHF 350 million, with 80% expected by 2028, mainly from group functions and overlapping roles in Switzerland and Germany.

• Two-thirds of cost synergies from FTE reductions, one-third from non-FTE costs like IT and admin.

• Integration costs projected at CHF 500–600 million, mostly incurred by end of 2028.

• Additional cash generation of CHF 220 million run-rate after tax and policyholder participation, supporting a 20% uplift in dividend capacity by 2029.

• Additional upside from capital and revenue synergies expected over time.