Ace Ltd, the Swiss insurer operating in more than 50 countries, is in talks to buy New York Life Insurance Co’s assets in Asia after two rivals dropped out, according to three people with knowledge of the matter.
New York Life ended negotiations with Manulife Financial Corp, Canada’s largest insurer, about the US firm’s units in Hong Kong, Taiwan and South Korea, said one of the people, who declined to be identified as negotiations are private.
Primus Financial Holdings Ltd, which had bid for the Hong Kong business, isn’t currently in talks, one person said.
One bidder had valued the New York Life assets for sale at about US$500 million to US$600 million, a person with knowledge of the matter said.
POLICYHOLDER-OWNED
New York Life, the biggest US life insurer owned by policyholders, also has operations in India, China and Thailand.
The company derived 21 percent of life insurance sales from international markets, according to its annual report from last year.
ASIAN ACQUISITIONS
The New York Life operations would mark Ace’s third acquisition in Asia, after it agreed to buy Malaysian general insurer Jerneh Insurance Bhd for about US$210 million this month.
Ace purchased a 22 percent stake in Huatai Insurance Co (華泰保險), a Beijing-based property and casualty insurer, for US$150 million in 2002, according to data compiled by Bloomberg.
Ace said on Sept. 14 it agreed to pay US$1.1 billion for a majority stake in Johnston, Iowa-based Rain & Hail Insurance Service Inc.
Primus Financial had bid about US$200 million for New York Life’s Hong Kong business, one of the people said.
FAILURE
The firm failed in its bid to buy American International Group Inc’s Taiwan unit this month after regulators rejected a US$2.15 billion takeover offer made with China Strategic Holdings Ltd (中策集團).
Foreign insurers including Aegon NV, Prudential PLC and ING Groep NV have exited Taiwan since last year. AIG said last month it will consider scaling back operations on the island.
“Taiwan is a very saturated market with negative spread so they probably want to bundle that up with other profitable markets and sell it in one package,” said CheIvan Cheung, an insurance analyst at Mirae Asset Securities Hong Kong.
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