Insurance talks

Tesco Bank close to buying out underwriting partner Ageas

Tesco Bank

Tesco Bank :seeking insurance deal

Tesco Bank is believed to be close to agreeing a £100 million deal to buy-out its insurance partner Ageas from their joint venture.

Tesco Underwriting (TU) was formed ten years ago to underwrite motor and household cover to the supermarket giant’s customer base.

Ageas (UK) owns 50.1% with Edinburgh-based Tesco Bank holding the remainder, but there has been talk in the trade that it wants to take on full ownership after offloading its mortgage business to Lloyds Banking Group.

Daily Business has learned that a deal is high on chief executive Gerry Mallon’s agenda.

TU has 1.5 million customers and operates independently from either of its shareholders with its own board of directors, governance processes and management team. It is not known if Tesco would continue to run TU as an independent entity or seek another partner.

TU reported a profit before tax of £24.4 million for the year to the end of December 2018.

A Tesco Bank spokesman said: “We never comment on rumour or speculation.”

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