Investment fund Volga Resources said it's agreed to acquire 54.1% of the share capital of the German insurer Schwarzmeer und Ostsee Versicherungs-Aktiengesellschaft, or Sovag, from the Russian insurer Ingosstrakh.

Terms of the transaction were not disclosed because it involves companies that are privately held, said Patrick d'Ancona, a spokesman for Volga.

The transaction has already been cleared by BaFin, the German Federal Financial Supervisory Authority, but is still subject to other regulatory approvals, such as from the German antitrust authority.

Sovag is a German nonlife insurance company offering auto, fire risk and property insurance as well as cargo, marine, aviation and transportation insurance for corporate and retail clients in Western Europe and the Commonwealth of Independent States, an organization that includes several former Soviet states. Sovag's gross written premium income in 2008 was 90 million euro (US$132.6 million).

Sovag is headquartered in Hamburg and has offices in Cologne, Berlin, Vienna and London.

According to Sovag's AMB Credit Report, Sovag is was established in 1927 by the Russian Ministry of Finance to insure the transport of goods between the Soviet Union and Western Europe. Nowadays, the insurer writes motor, property, transport and accident and health business.

Sovag benefits from a good business position as a specialist insurer for risks relating to Russia and the Confederation of Independent States, according to an AMB Credit Report. "However, A.M. Best believes that Sovag is not benefiting from the strong growth opportunities in its parent's (Ingosstrakh ) and other CIS markets," the report said.

Schwarzmeer und Ostee Vers-AG Sovag has a Best's Financial Strength Rating of B++ (Good).

Volga Resources is a private investment fund registered in Luxembourg in 2007. The fund invests in projects in the oil and gas sector, infrastructure, development, financial services in Central and Eastern Europe, CIS, Russia and Turkey.