Aegon (AEG, AGN.L) formed an exclusive 25-year strategic partnership with Spanish banking products provider Banco Santander (SAN, BNC.L) to distribute both protection and general insurance products via. the group's extensive network of more than 4,600 bank branches, including Banesto, Banif and Openbank, focused on a potential client base of 12 million customers.
Pursuant to the agreement, Aegon has agreed to buy a 51% stake in both a life insurance company as well as in a non-life insurance company for 220 million euros. Aegon may pay an additional amount after five years, depending on the partnership's performance. Moreover, Aegon Spain would provide the back-office services to the joint venture companies.
The transaction may close in the first half of 2013 and would be financed from existing resources.
"Aegon has been active in Spain for over thirty years and has established a reputation as a preferred provider of protection products through its network of bancassurance joint ventures with regional savings banks, or cajas. With this newest agreement, Aegon will consolidate its leadership position in this market in Spain," according to Aegon.
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