Erste Bank JPMorgan Merrill Lynch International

ACQUISITION OF THE TARGET COMPANIES AND
LONG-TERM GENERAL DISTRIBUTION AGREEMENT
The description of the Target Companies and the Erste Bank Group contained in this Prospectus,
including the financial information and operating data, with the exception of description of the
Acquisition and the General Distribution Agreement, is based solely upon the information that was
provided to the Vienna Insurance Group during the acquisition process or which is publicly available
and the Vienna Insurance Group has not independently verified this information. Please see “Risk
Factors – Risks Relating to the Acquisition of the Target Companies”.
Description of the Acquisition and the Long-Term General Distribution Agreement
On March 26, 2008, Wiener Städtische AG and various of its subsidiaries and Erste Bank AG and
various of its subsidiaries signed a series of agreements which set out the framework for the acquisition
of shares of Sparkassen Versicherung Aktiengesellschaft (the “S-Versicherung”), its subsidiaries in
Hungary and Croatia and its minority shareholdings in insurance companies in the Czech Republic and
Slovakia and two of Erste Bank Group’s Romanian subsidiaries operating in the insurance industry as
well as the future distribution arrangement between the Vienna Insurance Group and the Erste Bank
Group. The aggregate cash purchase price for the Target Companies and for the distribution arrangement
amounts to EUR 1,445.9 million, which the Vienna Insurance Group intends to finance with some
of the proceeds of this Offering as well as from the sale of hybrid notes (for details regarding the
financing for the acquisition see “– Financing the Acquisition” below). The transaction remains subject to
competition and insurance regulatory approvals and is expected to close in the third quarter of 2008.
S-Versicherung Group is an Austrian insurance group with operations in Austria, the Czech
Republic, Slovakia, Hungary and Croatia. Vienna Insurance Group through its subsidiary DONAU
already held a 5% interest in S-Versicherung since 1994 and a 10% interest in S-Versicherung since
2002 and has cooperated with the Erste Bank Group in the non-life insurance business since 1988.
Upon completion of the acquisition Wiener Städtische AG will own directly or indirectly approximately
95% of the shares in S-Versicherung and approximately 95% of the shares in each of S-Versicherung’s
subsidiaries in the CEE region. Wiener Städtische AG will also purchase approximately 88.5% of two
Romanian insurance subsidiaries (BCR Asigurari de Viata and BCR Asigurari) of the Erste Bank Group.
The Erste Bank Group will retain an approximate 5% interest in S-Versicherung and its subsidiaries to
demonstrate its long-term commitment to the future cooperation with the Vienna Insurance Group. Erste
Bank Group will also retain an approximate 5% interest in BCR Asigurari de Viata, but no interest in
BCR Asigurari.
In addition to the acquisitions, Wiener Städtische AG and Erste Bank AG have agreed to
cooperate in the distribution and sale of the other’s products. While becoming an important part of the
Vienna Insurance Group’s multi-channel distribution system, the Target Companies will continue to
conduct their own operations and the Vienna Insurance Group will make use of the respective name
brands and the local distribution channels of the Target Companies.
The parties have entered into a series of agreements to accomplish these goals. These
agreements include:
a framework purchase agreement relating to the acquisition, which will be implemented through
share purchase agreements relating to the purchase of shares in each of the Target Companies
(the “Framework Purchase Agreement”); and
as an integral part of the acquisition, a general distribution agreement pursuant to which the
Vienna Insurance Group and the Erste Bank Group will cooperate in the distribution and sale of
their respective products, while allowing each of the Target Companies to continue using its
respective current distribution channels (the “General Distribution Agreement”). The General
Distribution Agreement will need to be implemented by individual country agreements. See
“– General Distribution Agreement between Wiener Städtische AG and Erste Bank AG”.
Application for merger control approval will be made to the European Commission and to the
competition authorities in other jurisdictions. Clearances are expected to be granted in the third
quarter of 2008. In this connection, the Vienna Insurance Group might be required to divest itself of
certain of its existing insurance operations. See “– Disposition of Assets in Connection with the
Acquisition”. In addition the acquisition is subject to approval by the (recurrent) insurance regulators.
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