A potential sale is one of the options that Axa SA and Kuala Lumpur-based Affin Bank Bhd. are considering for their life and general insurance business in Malaysia, Bloomberg reported.
People with knowledge of the matter said off-loading the business could fetch around US$650 million. Axa and Affin Bank plans to raise around US$500 million from a deal involving Axa Affin General Insurance Bhd. and up to US$150 million on Axa Affin Life Insurance Bhd. There is no certainty that Axa and Affin Bank will sell all their holdings in the companies as deliberations are still at an early stage.
The move may be a response to the Malaysian government's decision to set a 70% ownership cap on foreign-owned insurers, according to the report. The Malaysian central bank previously said foreign-owned insurers had until April to outline their plans to comply with the ownership cap.
Axa currently holds 49.99% of Axa Affin General Insurance and 49% of Axa Affin Life Insurance. Affin Bank holds 49.95% of the Malaysian general insurance business and 51% of Axa Affin Life.
