Global private equity fund Blackstone Group LP is backing Mark Wilson, the former chief of AIA Group Ltd, in the bidding for ING Groep NV’s Asia insurance unit, a source directly familiar with the matter said.
The consortium led by Wilson faces stiff competition from others including AIA, Canada’s Manulife Financial Corp and Japan’s Dai-ichi Life Insurance Co in pursuit of ING’s Asia life insurance operations, which could fetch about $7 billion.
ING is selling its Asian life insurance and asset management units in two separate deals as the bailed-out Dutch bancassurer seeks to return the remaining state aid it received during the 2008 financial crisis. Since the bailout, ING has sold €15.2 billion ($18.6 billion) worth of assets across the world.
Wilson, a former rugby player in New Zealand, is a veteran insurance executive credited with holding together AIG Inc’s Asian operations at the height of the financial crisis.
“He has deep connections and enjoys credibility with Asian regulators, and that’s his trump card. But will that be enough to convince ING, that’s the real question,” said one person who has previously worked with Wilson.
Ahead of AIA’s more than $20 billion Hong Kong IPO in 2010, AIG CEO Robert Benmosche removed Wilson as AIA CEO and replaced him with Mark Tucker, in what was seen as a fallout from Prudential Plc’s failure to buy AIA.
Wilson’s consortium is eyeing ING’s Southeast Asian business, which could fetch more than $2 billion, sources have previously told Reuters. Final binding bids for the insurance business are due on July 16, sources said.
Six months after ING CEO Jan Hommen scrapped a joint IPO of ING’s Europe and Asia units in favor of an Asia sale, the auction has lost some early momentum as a worsening euro zone debt crisis is preventing some buyers from taking big M&A bets.
Metlife and Prudential Financial Inc, considered strong contenders to buy the entire insurance business, have exited the race.
Monday’s binding bids set the stage for a final round of negotiations, after which ING will consider whether to sell the life business in one piece or break it up and sell Japan, South Korea and Southeast Asia separately.
Blackstone has agreed to take part in Wilson’s consortium, which also includes Swiss Re AG and other parties, the source said on condition of anonymity. Blackstone declined to comment, and Swiss Re and Wilson were not immediately available for comment.
A sale topping $7 billion could make it Asia’s top insurance M&A and add to a flurry of financial institution deals being launched in Asia this year.
Sources told Reuters in June that AIA Group and Manulife had made it through to a shortlist and could submit final bids.
Richard Li, the son of Asia’s richest man Li Ka-shing, is also interested in the business, although one person close to the matter said Li was just bidding for the Hong Kong, Malaysia and Thailand business.
ING’s Southeast Asia operations, the smallest part of the Asian operations by profits and premium income, but the fastest growing, have generated the strongest interest among the assets up for sale, the sources said.