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Thu 28 Jul 2011 05:07 PM

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AXA Gulf eyes $1bn in sales within five years

European insurance giant said it wouldn’t rule out acquisitions to fuel growth

AXA Gulf eyes $1bn in sales within five years
The Middle East is a key insurance market for AXA, Droesch said

AXA,
Europe’s second largest insurer, expects to double its sales in the GCC to $1bn
within the next five years and has not ruled out acquisitions, its regional CEO
said Wednesday.

The
insurance firm, which is seeing double-digit growth in its regional operations,
plans to beat its 2010 growth of 14.5 percent, Jerome Droesch told Arabian
Business.

“We will
do more than $500m this year so it’s quite a big operation. I think the idea is
to target $1bn,” he said. “The growth is quite good; in fact, it’s double-digital
growth for us in revenues and in terms of profit.”

The
insurance group is ramping up its investment in emerging markets such as the
Gulf and Latin America following significant declines in its business in
Europe.

AXA in
May posted a two percent decline in first quarter revenue on a comparable
basis. The insurance group generated revenue of €27.9bn
($39bn) in the three months to March 31.

The firm
said it was confident it would raise profits this year in spite of the decline.

“The
first quarter reflected our continued focus on improving the profitability of
our operations, in line with the priorities we set early in 2010,” AXA deputy
chief executive Denis Duverne said in a statement.

The
Middle East is a key region for the insurance conglomerate, Droesch said.

“Mainly
we’d like to invest more in the Middle East and in Latin America. We’ll
continue to probably invest more in the future than what we have done in the
past,” said Droesch.

 “It’s [acquisitions] a possibility, we can
invest more than we have done in the past, so that can be done with internal
investment or it can be done via acquisitions also.”

The firm
said the introduction of compulsory insurance in parts of the GCC, such as
motor insurance and healthcare in Abu Dhabi, represented its biggest part of
its business. Healthcare insurance has increased 30 percent so far this year.

“Healthcare
[insurance]…has grown by around 30 percent this year compared to last year, and
in terms of life we have doubled the revenues compared to last year,” he said.

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