FRANKFURT (Reuters) – German reinsurer Hannover Re HNRGn.DE said it was in talks to acquire a minority stake in life insurer Heidelberger Leben, which Britain’s Lloyds Banking Group LLOY.L is selling as part of plans to exit overseas markets.
Hannover Re said its investment would be under 100 million euros (£85.2 million).
Its statement comes in response to media reports that Lloyds was hoping to sell the business for around 400 million euros, citing Hannover Re as the most likely buyer.
A source familiar with the matter told Reuters on Tuesday that the majority stake would be taken by a private equity investor and an announcement could come as soon as Wednesday.
“In view of the fact that negotiations are still ongoing, the company is currently unable to provide any further details in this regard,” Hannover Re said on Tuesday.
Lloyds declined to comment.
State-backed Lloyds has been trying to sell Heidelberger for at least two years, but struggled to find a buyer. When the insurer was put up for sale in 2011 it was reported to have an embedded value – an insurance-specific valuation measure – of 1 billion euros.
Lloyds’ German insurance sale follows the disposals of its $5 billion U.S. mortgage book, Spanish retail banking operations and international private banking business.
Shares in Hannover Re were down 0.2 percent at 1113 GMT, while Lloyds was down 2.6 percent. ($1 = 0.7490 euros)
Reporting by Alexander Huebner and Maria Sheahan; writing by Victoria Bryan; editing by Philipp Halstrick and Tom Pfeiffer
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