Ilmarinen’s general meeting decides on merger with Etera
Ilmarinen’s extraordinary general meeting decided on 14th September 2017 to approve Etera’s merger into Ilmarinen. The merger, effective as of 1 January 2018, will result in a solvent and cost-effective earnings-related pension company with the most competitive client benefits in the sector, as well as even higher quality and more diverse services.
“The general meeting concurred with the view of the Board of Directors that a merger would benefit the customers of both companies. The synergies gained through the merger will result in improved cost-effectiveness and, in turn, better client bonuses. More diverse and improved services for insurance customers and pensioners will also be possible. Thanks to the merger, the cost-effectiveness of the entire earnings-related pension insurance system will improve significantly and the overall solvency of the sector will strengthen,” says the Chairman of Ilmarinen’s Board of Directors, Mikko Helander.
Etera’s extraordinary general meeting approved the merger plan earlier this week. In its statement of 31 August 2017, the Finnish Competition and Consumer Authority stated that it sees no obstacle to the merger in competition law. The merger still requires the approval of the Financial Supervisory Authority.
In combining the strengths of both companies through a merger, the objective is to build a modern, innovative and agile service company that efficiently utilises the opportunities created by digitalisation.
“This is an important step in the merger. Our goal is to be the most cost-effective and attractive earnings-related pension company in Finland, and we have now received strong support for that goal from the general meetings of both companies. Together we can take on an even stronger role in supporting work capacity and productivity in Finnish companies. We will draw on the best practices and expertise of both companies to renew and develop services,” says Ilmarinen’s President and CEO, Timo Ritakallio.
The merger could lead to an estimated annual savings of EUR 20 million in administrative costs by eliminating overlaps and increasing operational efficiency. In addition, it would be possible to achieve both direct and indirect annual cost savings of at least EUR 20 million in investment operations.
Following the merger, Ilmarinen would manage the pension cover of more than 1.1 million Finns: the total number of insured exceeds 675,000 and pensioners number 460,000. The company’s market share of premiums written would be 37 per cent. Measured by the number of customers and premiums written, the merged company would become Finland’s largest private sector earnings-related pension insurer.
The merger will not require any measures from customers. Etera’s current customers will transfer to Ilmarinen after the merger, and their insurance contracts and pension payments will continue as usual.
New members on the Supervisory Board
The extraordinary general meeting also decided on changes to the Articles of Association regarding Ilmarinen’s governing bodies: four additional members will join the Supervisory Board, and the Board of Directors will have 14 standing members instead of the current 12. The purpose of the changes is to ensure that the expertise related to the merged company’s client base is taken into account in the company’s governance as broadly as possible.
The new members of Ilmarinen’s Supervisory Board, effective 1 January 2018, are HR Manager Markus Ainasoja, the Finnish Construction Trade Union; CEO Heimo Hakkarainen, VMP Group; EVP Harri Kailasalo, Lemminkäinen Infra Oy and Managing Director Matti Peltola, Koneyrittäjien liitto ry.
The decisions are conditional and will enter into effect once the merger is registered.
The term of office of Ilmarinen’s current Board of Directors will come to a close at the end of 2017, and the new Board of Directors will be elected in late autumn.
- Mikko Helander, Chairman of Ilmarinen’s Board of Directors, tel. +358 10 532 2301
- Timo Ritakallio, President and CEO, Ilmarinen, tel. +358 500 536 346
- Ilmarinen’s communications +358 10 284 2570