51% OF CROATIA OSIGURANJE TO BE PRIVATISED SOON

ZAGREB, Jan 11 (Hina) - An international tender for the sale of a majority share in the biggest Croatian insurance company, Croatia Osiguranje, should be announced next week, according to unofficial sources. Government officials confirmed on Friday a decision on the privatisation of 51 percent of Croatia Osiguranje would be made in the next few days. The price of Croatia Osiguranje will not be determined by the company's current value but its development potential, the government sources said. It has been estimated that the company's development value is at least twice as high as its current market value given Croatia's still undeveloped life insurance market. The government therefore expects the majority share could be sold at a price of more than EUR120 million. According to media reports, France's AXA and Italy's Generale are potential buyers, and it is speculated that Germany's Allianz and domestic businessmen, who were ready to establish a pool, are out of the game. In 2001, Croatia Osiguranje covered 54 percent of the Croatian insurance market. In the first nine months of 2001, its total revenue amounted to almost two billion kuna, which is 8.7 percent more than in the same period of 2000. Its profit in the same period rose by 82 percent to 56.8 million kuna. This year is expected to see the start of privatisation of big public companies and unofficial sources say the Croatian oil company INA could be the first one to undergo privatisation. A total of 25 percent of INA shares would be offered for sale. Russian and companies from Arabic countries, as well as Austria's OMV and Hungary's MOL are expected to show great interest. (hina) np sb