Hong Leong nixes sale of insurance operations

Deal with unnamed buyers canceled, but speculations point to major Canadian insurer and Asian sovereign fund

Insurance News

By Gabriel Olano

Hong Leong Financial Group Bhd, a financial group based in Malaysia, has announced that it has broken off negotiations regarding the sale of its insurance business.
“Further to our announcement dated June 30, 2016, we wish to inform that Hong Leong Financial Group Bhd and HLA Holdings Sdn Bhd could not reach an acceptable commercial agreement with the BNM-approved negotiating parties and have mutually agreed to cease negotiations,” it said in a stock market filing.
Previous news reports had named Sun Life Financial Inc. of Canada and Malaysian sovereign wealth fund Khazanah Nasional as parties interested to purchase the insurers. The deal was estimated to be worth MYR3 billion (US$713.96 million) and would provide Sun Life more access to emerging Asian markets, while allowing Khazanah to expand its insurance footprint.
HLA Holdings own a 70% stake in HLA, while it has 65% in HLMT. The remaining interests in both firms are held by Mitsui Sumitomo Insurance Co of Japan.

Related stories:
Malaysia’s takaful sector outstripping the Middle East’s, says AM Best
State-owned wealth fund may buy Hong Leong’s insurance operations
Malaysian financial group receives approval to sell its stakes in insurers

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