Ilmarinen and Etera to merge – customers will benefit from improved cost-effectiveness
The earnings-related pension insurance companies Ilmarinen and Etera intend to merge as of 1 January 2018. Their merger will create a solvent and cost-effective earnings-related pension company with the most competitive client benefits in the sector. By combining the strengths of each company, the goal is to build an innovative and agile service company that offers even more diverse and higher-quality services than before.
The Boards of Ilmarinen and Etera have approved the merger agreement according to which Etera will merge into Ilmarinen. The implementation of the arrangement will require approval from both companies’ general meetings and from the relevant authorities.
“The synergies achieved through the merger will benefit the clients of both companies. The merged company will embody solid expertise in insurance for companies of all sizes and self-employed persons, as well as special expertise in a number of sectors. Furthermore, thanks to the merger, the cost-effectiveness of the entire earnings-related pension insurance system will improve significantly and the sector’s solvency will strengthen overall. The transaction will thus benefit both policyholders and the insured alike,” says the Chairman of Ilmarinen’s Board of Directors Mikko Helander.
“The cost-effectiveness and strong solvency of the merged company will enable improved client bonuses for Etera’s current customers. Services will also be tailored to meet the needs of different client segments,” says Tero Kiviniemi, Chairman of Etera’s Board of Directors.
The new company would manage the pension cover of more than 1.1 million Finns – the total number of insured coming to over 675,000 and pensioners numbering 460,000. The company’s market share of premiums written would be 37 per cent. The merged company would become Finland’s largest private sector earnings-related pension insurer measured in the number of customers and premiums written.
A modern service company
The objective of the merger is to build a modern, innovative and agile service company that efficiently utilises the opportunities created by digitalisation.
“The merger is a chance for us to modernise and improve services on the basis of the best practices and expertise of both companies. Together, we can take on an even stronger role in supporting the work capacity and productivity of Finnish companies,” says Ilmarinen’s President and CEO Timo Ritakallio.
The parties assess that overlapping operations could be trimmed down and made more effective through the merger, thus achieving cost savings that would benefit client companies through growing client bonuses. According to current estimates, the merger would help to achieve annual savings in administrative costs of at least EUR 20 million beginning in 2020. The combined administrative costs of the companies were EUR 142 million in 2016. In addition, it would be possible to achieve both direct and indirect annual cost savings of at least EUR 20 million in investment operations.
“Our goal is to be Finland’s most cost-effective and attractive earnings-related pension company. We can offer both companies’ existing customers even better and more varied service packages based on their needs, in addition to improved client bonuses,” Ritakallio adds.
The merger will not require any measures from customers who will be kept up to date on the process as it moves forward. Etera’s current customers will transfer to Ilmarinen after the merger and their insurance contracts and pension payments will continue normally. High-quality well-being at work and work capacity management services will become available to all customers. The company’s distribution network will be developed based on current solutions, digital channels and regional presence.
The pension assets of the new company would be more than EUR 44 billion. The company would maintain a strong and diverse role on the investment markets in both Finland and globally. It would also be a major real estate investor and financing partner for growth companies in Finland.
The companies’ Boards have agreed in the merger agreement that Ilmarinen’s President and CEO Timo Ritakallio will continue in his position after the merger. Etera’s current Managing Director Stefan Björkman will become deputy to Timo Ritakallio. Ilmarinen’s current Deputy CEO Sini Kivihuhta will continue in her present position. A more detailed plan of other appointments and possible organisational changes will be prepared at a later date.
In selecting the representatives of the governing bodies, expertise related to the merged company’s client base will be taken into account as broadly as possible. The intention is to add four new members to Ilmarinen’s Supervisory Board, who will be elected based on nominations by Etera’s Election Committee. The term of office of Ilmarinen’s current Board of Directors will come to a close at the end of 2017. Instead of the current 12 members, the new Board will include 14 members and representatives familiar with Etera’s current customer base will be elected to the Board.
For more information, please contact:
- Mikko Helander, Chairman of Ilmarinen’s Board of Directors, tel. +358 10 532 2301
- Tero Kiviniemi, Chairman of Etera’s Board of Directors, tel. +358 40 519 0112
- Timo Ritakallio, President and CEO, Ilmarinen, tel. +358 500 536 346
- Stefan Björkman, Managing Director, Etera, tel. +358 50 63219
- Ilmarinen’s communications +358 10 284 2570
- Etera’s communications +358 10 5533 404
Ilmarisen vakuutusasiakaspalvelu on suljettu torstaina 1.2.2024
Ilmarisen työnantaja- ja yrittäjäasiakkaiden asiakaspalvelu on suljettu torstaina 1.2.2024 poliittisen lakon vuoksi. Henkilöasiakkaiden palvelu on käytössä normaalisti.
Olemme saaneet monia uusia asiantuntijoita ilmarislaisten joukkueeseemme. Tässä poimintoja.
Tulisitko meille kesätöihin?
Kesätyöhakumme 2024 on käynnistynyt. Löytyisiköhän meiltä sinua kiinnostava työ?