The untangling of Germany’s confusing cross-ownership arrangements continues, with Munich Re and Allianz the latest to announce that they will cancel a “principles of co-operation” agreement. Like most major German companies, the two have long held significant shareholdings in each other. But falling profits and investment troubles have seen ratings agencies and shareholders agitating for change.

Munich Re Chairman Hans-Jurgen Schinzler said the decision to cancel the agreement at the end of the year will not mean the two companies won’t co-operate in the future. “Irrespective of the cancellation of the agreement, we will continue to work closely together in reinsurance and retrocession.”

The two companies owned 25% of each other until three years ago, when it was reduced to 20% and then earlier this year to 15%. “Over a period of 10 years our companies have adjusted their relationships in several strategic steps, in some cases changes in the capital market and in company and supervisory law,” Dr Schinzler said.

Allianz Chairman Michael Diekmann said the cancellation of the agreement is a logical step. “Munich Re is and will remain an important and reliable business partner for us in reinsurance.”