Munich Re has no plans to sell Ergo, its primary insurance arm, and aims to strengthen this business through acquisitions once its turnaround has been completed in two years, Chief Executive Joachim Wenning said on Wednesday.


Ergo has been battling high costs and low margins and has sold off 13 foreign subsidiaries. Last year, it scrapped plans to divest its traditional life insurance business, which it now aims to wind down itself with the help of IT partner IBM .


“Ergo is part of the Group. Period,” Wenning said at the annual news conference of the world’s largest reinsurer. “In Ergo’s target markets, we can imagine acquisitions on a very material scale.”


But before embarking on such acquisitions, Ergo needs to regain its competitiveness, which it aims to do partly by cutting 2,100 jobs over the next two years.


Ergo has a market share of 6.3 percent, ranking it third in Germany after bellwether Allianz and Italy’s Generali . The company is targeting flat earnings of about 400 million euros this year and of 530 million in 2020.


That compares with Munich Re’s group profit target of 2.5 billion euros and of 2.8 billion for 2019.


Munich Re plans to pay out a record dividend for 2018 of 9.25 euros a share and has announced its seventh 1 billion euro share buyback in a row.Business in the first quarter has been in line with expectations,” Chief Financial Officer Christoph Jurecka said.


He estimated that Munich Re’s share of payouts related to the crash of a Boeing 737 MAX operated by Ethiopian Airlines would likely be between 100 and 120 million euros.