Sun Life Financial buys Malaysian insurer

Sun Life Financial Inc., a partner of Canada-based Sun Life Financial, is intensifying its Asia operations with the acquisition of a Malaysia-based insurance company.

 

It has partnered with  Khazanah Nasional Berhad to buy 98 percent of CIMB Aviva Assurance Berhad and CIMB Aviva Takaful Berhad for 1.80 billion Malaysian Ringgit (RM) or C$586 million, Sun Life noted in a disclosure to the Philippine Stock Exchange on Friday.

 

Sun Life would pay RM900 million or C$293 million for a new 20-year exclusive bancassurance agreement with CIMB Bank.

 

The deal calls for Sun Life and Khazanah to each acquire 49 percent of the company from Aviva International Holdings Ltd. and CIMB Group Holdings Berhad (CIMB Group). 

 

CIMB Group will retain a 2 percent share in the company.

 

Included in the deal is an exclusive right to distribute insurance products, including Takaful products, through the CIMB Bank network across Malaysia which includes 312 branches and eight million customers.

 

“This transaction is perfectly aligned with our strategy for expanding our footprint in Asia,” said Kevin Strain, Sun Life Financial Asia president. 

 

Khazanah managing director Tan Sri Dato’ Azman bin Hj Mokhtar said, “This is an important investment for Khazanah. It marks not just an opportunity to invest into an asset in a growth sector, but also brings together a unique commercial partnership among three strong parties in their respective areas.”

 

“Bancassurance remains a core component of our wealth management proposition and we believe that the enhanced bancassurance agreement and potential regional synergies will enable our new partners to manufacture and support a more competitive product range for us to take to our customers,” said Dato’ Sri Nazir Razak, group chief executive, CIMB Group.

 

 Key listed companies in Khazanah’s investment portfolio include Telekom Malaysia Bhd., Tenaga Nasional Bhd., CIMB Group, Axiata Group Bhd., IHH Healthcare Bhd., Malaysia Airports Holdings Bhd., and UEM Land Holdings Bhd. — VS, GMA News