logo
Share SHARE
FONT-SIZE Plus   Neg

Reports: Insurance Giants Vying For ING's Asian Life-insurance Arm

A slew of insurance giants are vying to acquire Dutch lender ING Groep N.V.'s (ING) Asian life-insurance arm in a bidding war that is expected to bring in a windfall for ING, according to media reports on Sunday. A deal could see a price tag of up to $6 billion. Most of them are looking to boost their operations in Asia, which is the currently the world's fastest-growing insurance market.

Among the potential bidders are MetLife, Inc. (MET), Prudential Financial, Inc. (PRU), Manulife Financial Corp. (MFC), and Sun Life Financial, Inc. (SLF). Meanwhile, Korea's KB Financial Group is said to be interested only in ING's South Korean life-insurance operations, and Samsung Life Insurance has also shown interest. Hong Kong-listed AIA Group Ltd., partly owned by American International Group Inc. (AIG), is also said to be in the fray.

Most of them have already said to have hired prominent advisers to advise them on possible bids. ING is reportedly to sell asset management and insurance operations in Asia separately.

In January, ING dropped its plans for a initial public offering for its insurance and investment management businesses in Europe and Asia, citing the uncertain economic outlook and turbulent financial markets. However, the company said it will prepare for an IPO for the U.S insurance and investment management businesses.

Hong Kong-based ING's life insurance operations consist of eight wholly owned or joint-venture businesses doing business in China, Hong Kong, India, Japan, Malaysia, South Korea and Thailand.

The proposed divestiture is a part of ING's ongoing asset sale in order to comply with an agreement reached with the European Commission while getting approval for a Dutch state aid during the financial crisis in November 2008. The proceeds from the divestitures are used to repay the government aid.

ING received 10 billion euros from the Dutch State in November 2008 after it issued 1 billion core Tier 1 securities, but repurchased 5 billion euros of the securities in December 2009.

The EU ordered ING to shrink its balance sheet by around 45 percent by 2013. The extensive EC restructuring requirements for ING Group also includes the actions that have been taken to separate Banking and Insurance in order to build strong businesses.

In mid-February 2012, Capital One Financial Corp. (COF) completed the acquisition of ING Direct business in the U.S. from ING for $6.3 billion in cash and about 54 million Capital One shares, representing a 9.7 percent ownership stake.

In October, ING completed the sale of majority of its real estate investment management business to CB Richard Ellis Group, Inc., which changed its name to CBRE Group, Inc. (CBG) in early October, for about $1.0 billion in cash in two separate transactions.

ING had in July 2011 agreed to sell its Latin American pensions, life insurance and investment management operations to Colombia-listed financial holding company Grupo de Inversiones Suramericana, or Gruposura, for a total of about 2.68 billion euros or $3.85 billion, as the first major step in the divestitures of its insurance and investment management businesses.

In early in July 2011, ING had reached a deal to sell its European car-leasing unit, ING Car Lease, to German luxury-car maker BMW Group's (BAMXY.PK, BAMXF.PK) fleet management division Alphabet for a consideration of about 700 million euros.

ING closed Friday's regular trading session at $8.78, up $0.08 or 0.92% on a volume of 2.07 million shares, lower than the three-month average volume of 3.84 million shares.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Editors Pick
British lender Lloyds Banking Group Plc. Friday reported higher profit in its first half, benefited by increased net interest income and margin as well as lower impairment. Looking ahead, the company lifted its net interest margin forecast. Amgen reported an increase in second-quarter profit, driven by sales of arthritis drug Enbrel and osteoporosis treatments Xgeva and Prolia, and improved margins. Both earnings and sales topped Wall Street estimates. Electronic Arts Inc. (EA) on Thursday reported an increase in profit for the first quarter, reflecting continued strong digital revenues, with both earnings and revenues topping Wall Street estimates. However, shares of the company fell over 4 percent, after having detailed a weak outlook. Redwood...
comments powered by Disqus
RELATED NEWS
Trade ING now with 
Follow RTT