Hong LeongFinancial Group Bhd. is in talks with two interested parties forthe potential sale of its insurance business, Reuters reported July 19, citing "twobanking sources."
Canada's SunLife Financial Inc. and Malaysian sovereign wealth fund KhazanahNasional are considering making a joint offer for Hong Leong's 70% stake inHong Leong Assurance Bhd.and its 65% stake in Hong Leong MSIG Takaful Bhd., the sources said.
The deal is reportedly valued at about 3 billion ringgit.Discussions with Sun Life and Khazanah are at the early stages but if atransaction pushes through, it will give the Canadian firm a foothold tofurther expand in Asian markets and give the Malaysian wealth fund a presencein the insurance business.
The report came after Hong Leong Financial in late June that itobtained regulatory approval to start negotiations with certain parties for asale of its insurance businesses. The firm has six months from June 23 tocomplete negotiations.
A Hong Leong spokeswoman confirmed initial talks withunnamed potential buyers, saying there were "no definitive developments atthis stage." Khazanah and Sun Life declined to comment on the matter.
As of July 18, US$1was equivalent to 3.98 Malaysian ringgit.