Banco Santander has announced that it will form a strategic partnership with Aegon to strengthen its bancassurance in Spain.
Under the terms of the partnership, Santander will create two new insurance companies, for life and non-life insurance, which will be 51% owned by Aegon.
Santander and Aegon will share responsibility for managing them. Santander will keep a 49% stake and sign a 25-year contract to distribute their insurance products via its branch networks.
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The deal excludes savings, health and auto insurance products, which will continue to be managed by Santander.
The bank will distribute joint insurance products via its branch networks in Spain.
Commenting on the agreement, Javier Marn, head of Santander's Global Private Banking, Asset Management and Insurance division, said: "This agreement will allow us to offer customers a wider and more innovative range of insurance products, co-managed by one of the world's leading insurers. It will accelerate our growth in the insurance business, thanks to the combination of the partners' strengths".
Alex Wynaendts, Chief Executive Officer of Aegon, said: "With Santander we look forward to reaching and serving an even greater number of potential customers seeking long-term financial security in these uncertain times."
The transaction, which is expected to close in the first half of 2013 subject to regulatory approval, will generate a pre-tax capital gain of €410m for Grupo Santander, based on the valuation of the entire business.
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