U.S. based insurer MassMutual will sell its stake in a joint venture with partner Mercuries Corp for T$3 billion ($97 million), in the latest exit by a foreign player of Taiwan’s $52 billion life insurance market.
Mercuries and its units will buy MassMutual’s 39.01 stake in the venture, MassMutual Mercuries Life, adding it to their existing combined 39.01 percent, said Edward Pu, an assistant vice president of Mercuries.
“The deal comes as MassMutual adjusted its overseas strategy,” Pu said. “Foreign insurers have pulled out the Taiwan market one after another.”
Prudential Plc, ING Groep and Aegon have all pulled out of Taiwan’s low-growth market, in part to help shore up finances at home during the financial crisis. A stricter accounting system to be put in place in Taiwan also contributed to the exits.
Bailed-out U.S. insurer AIG and MetLife are both trying to sell their Taiwan assets.
The MassMutual joint venture is Taiwan’s sixth-largest life insurer with assets of T$416.2 billion, 1.6 million policy holders and more than 12,000 agents.
Mercuries plans to list the venture in Taiwan around 2012, Pu said.
At 0200 GMT, Mercuries shares had risen 2.4 percent, while the broader market was unchanged. Mercuries expects to close the transaction at year-end, after submitting to Taiwan regulators later this month, Pu said.
Source : Reuters
