South Korea’s KB Financial Group is interested in buying ING Groep NV’s South Korean insurance operations, chairman Euh Yoon-dae said.
The parent of the country’s top mortgage lender which has an existing life insurance joint venture with ING, KB Life Insurance, has been eyeing possible takeover targets in the life insurance sector as KB wants to diversify its revenue sources heavily dependent upon its banking business.
The prospective sale of ING’s Asian insurance business, potentially Asia’s second-biggest insurance sale ever, is seen heating up with news that AIA Group is expected to hire banks to advise on a possible bid.
U.S. Prudential Financial, the No.2 U.S. life insurer, has picked Bank of America Merrill Lynch as an adviser for a potential bid, a media report in South Korea said.
But, Euh, whose comments were confirmed by a company spokesman, told reporters that the group would need to find a partner if the entire Asia-Pacific operations of ING were put on sale as a package.
He added that the company would be willing to join hands with Samsung Life Insurance if Samsung proposes a tie-up.
ING’s Korean operations are slightly larger than its business in Japan; in the first three quarters of 2011, ING Life Korea contributed about 43 percent of ING Asia’s gross premiums and about 39 percent of underlying profit.
Banking sources said earlier that Korean banking groups KB and Woori Finance Holdings are also looking at ING’s Korean assets, adding they might be keen on bidding if ING were willing to sell its Korean operations separately.
The Dutch financial group announced last month that it was considering options to dispose of its Asia insurance and investment management businesses separately from its European businesses, a move that would help it pay back the 2008 bailout it received from the Dutch government.
Investment banks have been hired to run the sale and the auction will split ING’s Asia investment management business into a separate sale, Reuters reported earlier.
Shares in KB fell 1.7 percent by 0554 GMT versus the wider market’s 0.19 percent gain.
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