Insurance group IAG is selling out of its businesses in Thailand, Indonesia and Vietnam following a strategic review of the region.
The company today announced the $525 million sale to Tokio Marine & Nichido Fire Insurance of IAG’s operations in Thailand and Indonesia.
A short time ago, IAG shares were up 2.3% to $8.415.
The agreement covers IAG’s 98.6% of Safety Insurance in Thailand and 80% of PT Asuransi Parolamas in Indonesia.
Tokio Marine forms part of Tokio Marine Holdings, the largest property and casualty insurance group in Japan, with operations in 38 countries.
“We are pleased to accept the offer for our businesses in Thailand and Indonesia from Tokio Marine,” says IAG Managing Director and CEO Peter Harmer.
“We believe Tokio Marine is an ideal owner given its experience in the region, and that this is a good outcome for the associated employees, customers and other stakeholders.”
IAG has also reached an agreement to sell its 73.07% interest in AAA Assurance Corporation, based in Vietnam. A price wasn’t announced.
The company says an after-tax profit of at least $200 million is expected to be in the 2019 results from the combined transactions.
And IAG says it expects a 50 basis points enhancement to its reported insurance margin, owing to the lower earnings profile of the Asian businesses.
IAG is currently going about simplifying its business, by consolidating technology platforms, harmonising products, and simplifying processes and systems.
In its latest half year results, the company announced a 23.5% lift in net profit to $551 million.
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