Cigna Corp. announced a new joint venture with a Saudi Arabian insurer that Cigna has had a partnership with for years, selling products in the Middle East.
Cigna's Global Health Benefits and Saudi Arabian Insurance Company B.S.C. (SAICO) announced the joint venture Tuesday. The two companies have partnered for 11 years selling health, wellness and insurance products to regional and national employers and other groups in the Middle East.
In the past, Cigna sold products through SAICO, and the new joint venture will be a stand-alone company.
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Cigna and SAICO will each own half of the joint venture partnership, which is subject to regulatory approval and other conditions. After the deal is final, Cigna and SAICO will announce the name of the new company and where it will be headquartered.
Cigna did not release any financial details of the arrangement.
"The joint venture combines the strengths of our two organizations and aligns the current partnership around a common goal of meeting the needs of customers and clients located in the Middle East for enhanced customer service and efficiency," SAICO CEO Nagib Bahous said in a prepared statement. "In this partnership with Cigna, SAICO will be able to improve on cost containment through clinical and claims management."
This is one of many cases of a U.S. insurer buying a stake in a foreign company or launching a joint venture with a foreign company. For example, The Travelers Cos. said earlier this month that it increased its stake in a Brazil surety insurer.
Andrew Kielty, president of Cigna Global Health Benefits, said in a prepared statement: "SAICO is a well-regarded general insurance company in the region and in partnership together, we have developed a solid reputation in the marketplace through our collective strength and focus, market knowledge, vast network and combined service proposition."