Austria's Wiener Staedtische Allgemeine Versicherung AG will acquire a 40% stake in Kardan Financial Services (KFS) B.V., an Israeli company registered on the Dutch bourse, for 113 mln euro, several international news agencies reported on Wednesday. KFS holds 70.24% in Dutch-registered financial group TBIH Financial Services Group NV, which indirectly owns a host of Bulgarian non-banking financial companies including the nation's second biggest insurer Bulstrad and top pension insurer Doverie. The group's Bulgarian arm services over 1.35 mln clients, including 1.15 mln clients of Doverie. For its part, Wiener Staedtische controls 93.6% in Bulgarian insurer Balgarski Imoti. The Austrians have negotiated a future increase of their KFS stake to 50%. News of the acquisition sparked rumours about a future merger between Bulstrad and Balgarski Imoti. Estimated on the basis of data for the 9-month period, the future structure would hold 18.4% share of the insurance market, coming second behind DZI. On the life insurance segment, a merger would land the new structure at no.5 with a share of 8.5%. The general insurance arm of Balgarski Imoti ranked as the nation's no.12 at end-September with a market share of 1.39%. The life insurance division had a market share of a little more than 2%. Wiener Staedtische's latest acquisition is part of an expansion strategy in Eastern Europe. Four months ago the company announced plans to invest 500 to 900 mln euro in Bulgaria, Romania and Ukraine over the next couple of years. The funding will be raised through a public offering.