KUALA LUMPUR (Oct 2): AMMB Holdings Bhd and MetLife International Holdings LLC are proposing to divest their jointly owned insurance and Takaful businesses to Great Eastern for approximately RM1.12 billion.
AMMB’s wholly owned AMAB Holdings Sdn Bhd owns 50% minus one share in AmMetLife Insurance Bhd and 50% plus one share in AmMetLife Takaful Bhd, with the remaining stake in both units owned by MetLife.
Upon securing the necessary regulatory approvals, AMMB said the involved parties will proceed with a sale and purchase agreement.
The plan is for Great Eastern Life Assurance (M) Bhd and Great Eastern Takaful Bhd to buy a 100% share capital in AmMetLife Insurance and AmMetLife Takaful.
Post-acquisition, both AmMetLife Insurance and AmMetLife Takaful will be merged and integrated with Great Eastern Life Assurance and Great Eastern Takaful respectively.
According to AMMB’s stock exchange filing, the proposal will also see these four insurance units entering into exclusive 20-year bancassurance and bancatakaful agreements for the distribution of life insurance and family takaful products, through the distribution network of AMMB’s banking subsidiaries across Malaysia.
The proposal is subject to, among others, the prior written approval of Bank Negara Malaysia and/or the Minister of Finance, and the Monetary Authority of Singapore.
In a statement on Monday, AMMB group chief executive officer Datuk Sulaiman Mohd Tahir said the “synergistic integration will provide us with the advantage of securing economies of scale that will translate into superior customer value, enhanced by our combined and complementary capabilities in product design, digital innovation and distribution expertise”.
“We are genuinely excited about the potential this alliance holds. It is not just about business growth; it is about transforming the customer experience. We are committed to utilising this strategic collaboration as a springboard for innovation, developing tailored solutions to meet the needs of our diverse customers at different life stages in the Malaysian market,” he added.
According to MetLife and AmMetLife’s websites, their strategic partnership dates back to April 2014, when MetLife took up half of the shareholdings in AmLife Insurance and AmFamily Takaful Bhd (which later had its name changed to AmMetLife Takaful) at a price tag of RM812 million or US$249 million.
Shares of AMMB closed two sen or 0.5% higher at RM3.72 on Monday, giving it a market capitalisation of RM12.33 billion.