Swedish manufacturing giant AB Volvo has sold its captive reinsurance group to Luxembourg-based financial-services holding company Ikano S.A., Volvo said.
Completing the sale of the Luxembourg-based Volvo Group Re S.A. will generate a capital gain of 34 million Swedish kronor ($1 = 6.68 kronor), said Volvo, which no longer owns the automobile business bearing its name but continues to manufacture trucks, buses, construction equipment, marine and industrial drive systems and aerospace components.
Formed in 1985 as a part of industrial equipment maker Cardo A.B., Volvo Group Re joined the Volvo Group in 1988 as a part of Volvo's acquisition of Cardo. Together with Swedish parent Volvo Group Insurance Forsakrings A.B. and Dublin-based sister company Volvo Group Insurance (Ireland) Ltd., the captive insurers provide reinsurance for Volvo's property, business disruption and liability risks -- as well as certain personnel insurance coverages -- with premiums paid by the company.
Headquartered in Luxembourg, the Ikano Group is a family-owned holding company of Scandinavian origin founded by Ingvar Kamprad in Almhult, Sweden in the 1940s. It has holdings in the finance, real estate, asset management, retail and insurance markets.
The group's insurance division writes both primary and reinsurance, with life insurance written through Dutch-Nordic Life Insurance N.V. and nonlife insurance written through Dutch-Nordic Insurance N.V.