CommInsure and AIA Australia now operate as one entity, after a joint cooperation agreement between the Commonwealth Bank (CBA) and AIA was implemented, prior to the completion of the CBA life unit’s $2.4 billion sale.
The acquisition, which was originally priced at $3.8 billion, will be finalised after CBA divests its 37.5% stake in Chinese life insurer Bocomm Life and once it receives Chinese regulatory approval.
CBA has received an upfront payment from AIA of $500 million; while the Hong Kong life insurer obtained the full economic interests associated with CommInsure Life (excluding the group’s 37.5% equity interest in BoCommLife), as well as an appropriate level of direct management and oversight of the business.
The deal between CBA and AIA also includes reinsurance arrangements and a 25-year Australian distribution agreement.
“We are excited by the opportunity to bring together the strengths of AIA and CommInsure Life and are working hard with our partner to develop a new generation of products for CBA’s customers, which will deliver excellent customer outcomes,” said Matt Comyn, CBA CEO.
Damien Mu, AIA Australia and New Zealand CEO, said the “transformative deal” will further strengthen AIA’s market position.
