(Updates with background on recent insurance deals and the
Argentine economy.)
By Ken Parks
BUENOS AIRES--The U.K.'s RSA Insurance Group PLC (RSAIF, RSA.LN)
said Thursday it has acquired two Argentine insurers for an
undisclosed amount.
RSA said in a statement that it has purchased general insurance
company El Comercio Compania de Seguros and surety company
Aseguradora de Creditos y Garantias.
The acquisitions make RSA the No. 6 company in Argentina's
general insurance market and No. 1 in surety insurance.
RSA's buys come less than six months after HSBC Holdings PLC
(HBC, HSBA.LN) agreed to sell its general-insurance business in
Argentina to Australia's QBE Insurance Group (QBIEY, QBE.AU).
Foreign insurers appear to be undaunted by Argentina's strict
capital controls and unstable economy.
Capital controls mean that since late 2011 insurers have been
forced to invest almost exclusively onshore in Argentina's tiny
financial market.
Recent economic data point to an abrupt slowdown in Argentina's
economy due to sluggish trade with Brazil and inflation that is
widely thought to be north of 20%.
RSA's move to expand its presence in Argentina comes amid a
tense standoff between the South American nation and the U.K. over
the Falkland Islands in the South Atlantic. Argentina claims
sovereignty over the islands, which have been in British hands
since the 1830s.
In recent months, Argentina has threatened to take legal action
against U.K.-listed companies exploring for oil in the waters
surrounding the Falklands.
Write to Ken Parks at ken.parks@dowjones.com
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