Romanian Insurer Certasig To Assign EUR500,000 For Stake In Future PAID

"The proposal was approved by Certasig's board of directors and is pending further approval from Certasig shareholders in April," Certasig general manager Radu Francu said Tuesday.

The setting up of PAID was stipulated in Law 260/2008 regulating the mandatory home insurance against earthquakes, landslides or floods. Under the law, the companies that will conclude this type of insurance policies will partner up and set up PAID.

The law also stipulates that each shareholder is entitled to maximum 15% in PAID.

According to a draft order of Romania’s insurance regulator CSA, the future PAID must have a share capital of minimum EUR12 million.

Beside Certasig, shareholders of insurance companies Astra, Ardaf and Generali will also discuss their participation in PAID in April.

Certasig, with a share capital of over 62 million lei (EUR1=RON4.2348) and majority owned by Swiss Certasig Holdings, operates the general insurance segment and reported EUR3.2 million in revenue in 2008. According to Francu, the company estimates to underwrite premiums of over EUR7 million in 2009.

Certasig Holdings became majority shareholder in Certasig in the second half of 2007, upon purchasing a 67.37% stake from four individuals in Spain. Subsequently, Royalton Partners increased its stake in Certasig to over 95%.

Headquartered in Zurich (Switzerland), Royalton Partners manages investment funds for Central and Eastern Europe and set up offices in Warsaw, Prague, Budapest and Bucharest.