Editor's note: This tracker covers possible deals reported by media across the Asia-Pacific region over a certain period. The information is gathered from various news sources, excludes confirmed deals and is limited to potential acquisitions or sales involving companies or operations in the region. Click here to read the previous month's article.
Several possible insurance deals surfaced in July as foreign companies in Malaysia consider selling stakes in their local units ahead of tougher foreign ownership caps, while Australian banks mull the sale of their life insurance businesses.
Foreign insurers are weighing their options in regard to their Malaysian units ahead of potential tougher enforcement of a cap on foreign ownership in the sector, Bloomberg News reported July 20. Malaysia's central bank had asked foreign insurers to pare down their stakes in their local units to 70% by the end of June 2018.
Below is a snapshot of July reports of possible deals compiled by S&P Global Market Intelligence.
Among the foreign insurers considering cutting their stakes in their Malaysian units are Prudential Plc, which is considering an IPO or a stake sale to an investor, sources told Bloomberg. Singapore's Great Eastern Holdings Ltd. is also considering an IPO as a means to cut its stake in Great Eastern Life Assurance (Malaysia) Bhd., they added. Moreover, Japan's Tokio Marine Holdings Inc. has appointed a bank to advise on options for divesting its stake in its Malaysian unit.
Meanwhile, Australia's major banks are considering options for their life insurance businesses, including possible sales. Commonwealth Bank of Australia is looking at a possible sale of its CommInsure business, which is valued at about A$5 billion, The Australian Financial Review's Street Talk blog reported July 19. The bank has asked JPMorgan to help it review its options for the business, which includes a possible quota share reinsurance deal with an overseas company.
Suncorp Group Ltd. and AMP Ltd. have also been reviewing the future of their life insurance businesses, the blog reported.
Commonwealth Bank of Australia's rival Australia & New Zealand Banking Group Ltd. is said to have shortlisted bidders for a sale of its wealth and life insurance business, Bloomberg News reported July 5. The shortlisted bidders include AIA Group Ltd., MetLife Inc. and Zurich Insurance Group AG. ANZ is expected to reveal the buyer by the end of December.
The move is part of ANZ's efforts to focus on its core banking business. The bank is also selling off its minority stakes in Asia, including a potential sale of its 39% stake in Jakarta-based PT Bank Pan Indonesia Tbk, Bloomberg reported. In Malaysia, ANZ is said to be close to a deal to sell its stake in AMMB Holdings Bhd. to Malaysian retirement fund KWAP, Reuters reported July 12. The deal could be worth approximately US$900 million.
ANZ is reportedly in talks with KWAP to sell its stake in the merged entity that will result from a merger between AMMB and RHB Bank Bhd. AMMB and RHB Bank had previously entered into an exclusivity agreement to negotiate the terms for a planned merger. If the merger proceeds, ANZ's stake in the merged entity is expected to be about 10%.
Commonwealth Bank of Australia's and ANZ's moves to retool their wealth management strategies are in response to a shifting regulatory climate, experts told S&P Global Market Intelligence in a July 23 report. Banks are trying to work out if they can release capital by selling these wealth management businesses, said Brian Johnson, a banking analyst at CLSA in Australia. The need has become more urgent following the Australian Prudential Regulation Authority's announcement that it is increasing the minimum requirement for common equity Tier 1 capital at all major banks by about 150 basis points, under a Jan. 1, 2020, deadline.
Meanwhile, there were also a number of possible insurance deals in India. IDBI Federal Life Insurance Co. Ltd. is seeking buyers for a 100% stake and is hoping to attract bids from all major domestic insurers, Mint reported July 26. The proposed stake sale will mean the complete exit of shareholders IDBI Bank Ltd., Federal Bank Ltd. and Belgian insurer Ageas SA/NV from the joint venture.
IDBI Federal Life Insurance is hoping for a valuation of about 30 billion Indian rupees.
While IDBI Bank and Federal Bank are looking to divest their stakes in their insurance joint venture, Andhra Bank said it has no plans to sell a stake in its insurance joint venture, IndiaFirst Life Insurance Co. Ltd., Press Trust of India reported July 12.
A senior bank official said the lender is not considering a sale as it expects the insurer's valuation to go up in the next two to three years. Andhra Bank holds a 30% stake in the insurer.
ICICI Prudential Life Insurance Co. Ltd. expressed its willingness to acquire Sahara India Life Insurance Co. Ltd. after it was named as a possible candidate by the Insurance Regulatory Authority of India to acquire Sahara Life before it could wind it down. ICICI Prudential Life in a July 4 disclosure confirmed its interest in evaluating the acquisition of Sahara Life's assets and its policyholders' liabilities.
To read articles about other deal possibilities, click on the following headlines:
Hong Kong's Mason Group to form wealth unit; seeks acquisitions
KKR Credit makes bid for Australia's Pepper Group
Cape Investment picked as preferred bidder for 10.04% stake in SK Securities
Report: 3 firms submit binding bids for SK Securities stake
CIMB Group open to M&A opportunities in overseas markets
Bank Rakyat Indonesia seeks to acquire venture capital firm
Report: 3 bidders shortlisted for 20% stake in Philippines' East West Banking
US-based Ebix to inject US$100M in Indian unit for expansion plans
Catholic Syrian Bank considers IPO, stake sale to raise capital
Report: IDBI Bank to sell 5% stake in Clearing Corp. of India
Shriram Group, IDFC enter talks for potential merger
Reports: India's IDFC, Shriram Capital in talks to merge
Report: IndoStar to acquire majority stake in ICICI Home Finance
China's Legend Holdings in discussions to acquire 90% of Luxembourg private bank
Report: State owners explore NORD/LB merger as Plan B for HSH Nordbank sale