At Wednesday's extraordinary general meeting, held in Düsseldorf, Allianz shareholders approved the merger of Italian Allianz subsidiary Riunione Adriatica di Sicurta SpA, or RAS, into Allianz AG. With this, an important step was made towards transforming the holding company into a "European company" (a so-called SE).

"For us, the merger is an investment in Europe," said Allianz CEO Michael Diekmann. "The lion's share of our sales and profits originates from our European markets, as do the majority of our customers, shareholders and employees."

Headquarters are set to remain in Munich, while the company will also maintain its policy of co-determination on a parity basis once the merger has taken place in September.

Allianz's takeover of its Italian unit cost some 5.9 billion euros ($7 billion) and affords the group an opportunity to consolidate and broaden its position on the fast-growing Italian market, as well in Spain, Austria, Switzerland, Portugal and Turkey.

Shareholders approved the merger with a clear majority. "Allianz has transformed itself from a very German company into a European one," said Daniela Bergdolt from DSW, Germany's oldest and largest association for private investors. "I believe that its restructuring is of great benefit to its shareholders."

Klaus Schneider of the SdK investors' association agreed that the move proved Allianz to be a pioneering company with commendable entrepreneurial spirit.

Employee concerns

Others were less upbeat. With Allianz employees fearing that the planned scaling down of German operations could result in up to 8,000 job cuts in the total domestic German workforce of 40,000, Rolf Zimmermann from the European Works Council accused the executive board of failing to take seriously employee concerns about job security, thereby jeopardizing the restructuring plans.

Like other top German companies such as Deutsche Telekom and Continental, Allianz has been criticized for announcing job cuts at a time of big profits.

Employees' representative Jens Schultzki called on the board to suspend job cuts and site closures until 2012. "Only then can you count on our support," he said. "We will not seal our own fates."

Fair and just

Diekmann defended the Allianz shake-up, arguing that the company's three independent German wings were increasingly obsolete.

"We are embarking on these changes now," he stressed, "to avoid waiting until we have to resort to rapid, short-term action because of we're making losses."

"I've always said that we want to generate growth," Diekmann told staff recently. "In order to achieve this, we need a sensible new structure and we need to cut costs."

But any changes would take place on the basis of the "confidence and feedback" from the workforce, Diekmann promised, insisting that they would be implemented "fairly and justly."