Ageas has agreed to acquire the remaining 25% stake in AG Insurance from BNP Paribas for €1.9 billion (US$2.21 billion), giving the Belgian group full 100% ownership of its main Belgian insurance subsidiary.

The transaction will be funded through available cash and existing financing facilities, the companies said in a joint statement.

As part of the agreement, BNP Paribas, which currently holds about 15% of Ageas, will increase its shareholding in the insurer to 22.5%. The move reshapes the long-standing partnership between the two groups by concentrating ownership of AG Insurance with Ageas while giving the French bank a larger direct interest in the broader group.

BNP Paribas said the sale of its stake in AG Insurance will generate a capital gain of €820 million. It also expects the deal to lift its net income by €40 million per year once completed.

Read more: Allianz UK taps BNP Paribas for global custody, lending, and FX services

The transaction comes as BNP Paribas continues to build out its insurance-related services business, including its 2025 mandate to provide global custody, lending, and FX services to Allianz UK through its securities services arm. Under that arrangement, BNP Paribas delivers asset servicing and reporting through its NeoLink platform.

In parallel, the group’s insurance arm BNP Paribas Cardif has been expanding in Asia, securing regulatory approval in China for a new property and casualty joint venture with Volkswagen and Xiaomi. The Beijing-based venture, BNP Paribas Tianxing Property & Casualty Insurance, gives the bank a non-life platform.

Read more: Ageas finalises £1.3 billion deal for esure

Following the announcement of the planned acquisition of the AG Insurance stake, Ageas updated its financial targets for the medium term. The insurer raised its 2027 free cash flow target to €2.6 billion, up from a previous objective of €2.3 billion, and said it now expects shareholder remuneration to reach €2.2 billion instead of €2 billion.

The revised ambitions align with a broader capital deployment programme that includes Ageas’s £1.295 billion acquisition of UK motor and home insurer esure, completed in 2025. Ageas expects that deal to generate annual cost savings of more than £100 million, deliver a return on investment above 12% after 2027, and be accretive to holding free cash flow per share by around 10% after 2027.