MAA plans to sell major stake in insurance arm

 

MAA Holdings Bhd (MAAH) plans to sell a major stake in its insurance arm, MAA Assurance Bhd, to a foreign insurer by the end of this year, its chief executive officer and group managing director Umar Swift said.
The group is considering selling a 49 per cent stake in MAA Assurance, the maximum a foreigner can hold in a local insurance company.

Umar said that there was currently no formal negotiation with any parties although it has been approached for some form of partnership in the past.

"We have asked interested parties to propose to us," he told Business Times, without elaborating.

The foreign partner will help propel MAA Assurance into the regional insurance business at a lower cost and quicker rate as domestic competition heats up.

Most recently, MAAH bought a 5 per cent stake in Bahrain-based Solidarity Co BSC for RM27.75 million. Solidarity also owns 25 per cent of Islamic insurer MAA Takaful Bhd through a joint venture with MAAH.

Interest from foreign insurers is not new to MAAH. Seven years ago, it was reported that the US-based New York Life Insurance Co had talked to MAAH on a possible merger.

MAAH is the country's leading insurance company in terms of annualised new business premiums for the life insurance business and total gross premiums for the general insurance business.

The life insurance and general insurance divisions recorded gross premium income of RM1.4 billion and RM453 million respectively for the year ended December 31 2006.

MAA Assurance had 56 branches and service centres as well as an agency base of 14,618 as at April this year. It also has 1.06 million general insurance policyholders and 782,904 life insurance policies in force.

MAAH is controlled by the Melewar group, which is linked to the Negri Sembilan royalty and helmed by Tan Sri Tunku Abdullah Tuanku Abdul Rahman, who is also the chairman of MAAH.

MAAH spearheads Melewar Equities Group's financial services division, while Melewar Industrial Group Bhd is the industrial division arm.

Tunku Abdullah and his sons - Datuk Tunku Iskandar, Tunku Yahaya and Datuk Tunku Ya'acob - are major shareholders of MAAH.

MAAH's authorised capital is RM500 million, while its issued and paid-up is RM304.35 million.

Over the years, MAAH has expanded its operations into Indonesia and the Philippines through MAA International Assurance Ltd, the offshore insurance arm of the group.

In Indonesia, it has a life insurance subsidiary, PT MAA Life Assurance, and a general insurance subsidiary, PT MAA General Assurance.

In the Philippines, it has a general insurance associate company, MAA General Assurance Philippines, Inc, and a mutual fund subsidiary, MAA Mutualife Philippines, Inc.
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