Two lists, two strategic plans and two opposing visions for the future of Generali. Tomorrow at the shareholders’ meeting of the insurance company, control of the group is up for grabs for the next three years. On the one hand, the list of the outgoing board of directors, supported by Mediobanca and De Agostini, proposes the line of continuity, made up of sustainable growth and rich dividends, nominating group ceo Philippe Donnet for the third term. On the other hand, the group of strong partner Francesco Gaetano Caltagirone, supported by Leonardo Del Vecchio and the Benetton family, focuses on a more aggressive strategy, with the aim of a double profit growth rate and financial resources dedicated to mergers and acquisitions more you double than Donnet’s plan.
The strategic program of the Caltagirone group for Generali, however, confirms two pillars of the strategy presented to the market in December 2011 by the French manager: the 5.2-5.6 billion euros of cumulative dividends between 2022 and 2024 and the 500 million buyback, the first in 15 years.
But the most obvious deviation of the ‘Awakening the lion’ counter-plan from Donnet’s ‘Lifetime Partner 24: Driving Growth’ strategy is the pace of earnings growth. The group CEO of the company expects an average annual increase in earnings per share between 6% and 8%, while the challengers aim for an annual increase of over 14%, through both organic and non-organic interventions, to arrive to a profit of approximately 4.2 billion in 2024. And if Donnet indicates net cash flows available over 8.5 billion by 2024, the Caltagirone group estimates a generation of cash between 9.5 and 10.5 billion.
The program embodied by Claudio Costamagna and Luciano Cirinà, candidate president and CEO, is even more ambitious in terms of cost reduction, with the aim of a cut of 600 million per year, with a target cost / income ratio of 55% from current 64%. Donnet’s plan, on the other hand, estimates an improvement of 2.5-3 percentage points.
The push on acquisitions is one of the pillars of Caltagirone’s strategy, which accused the current management of having missed opportunities and of having condemned the company to chase after its main European rivals. In his plan to 2024, the French manager indicates 2.5-3 billion in cash flow to be reinvested in M&A operations in the insurance business, in the countries where the group is already present and in Asia, and in asset management, in particular in the United Kingdom and the United States. More than double resources for challengers, with 7 billion dedicated to acquisitions in the Non-Life sector, in asset and wealth management, in fintech and insurtech. Consolidating the presence of the company in Italy, France and Germany, growing in Eastern Europe, China and India and developing in the United States, especially in the field of asset management
The Caltagirone group’s innovation program also increased, with 1.5-1.6 billion euros of investments in digital and technological transformation. Donnet is dedicating € 1.1 billion to this front, already up 60% compared to the 2021 plan, as well as a venture capital fund of € 250 million to seize high-potential opportunities in insurtech.
