AIA, Manulife Said to Bid for SCB's Thai Life Insurance Unit

  • Thai billionaire Charoen partners with Great Eastern on bid
  • Richard Li’s FWD Group, Prudential make separate offers

AIA Group Ltd. and Manulife Financial Corp. are among bidders for Siam Commercial Bank Pcl’s life insurance operations in what could be the biggest-ever acquisition of a Southeast Asian insurer, people with knowledge of the matter said.

Thai billionaire Charoen Sirivadhanabhakdi is partnering with Singapore’s Great Eastern Holdings Ltd. on a non-binding offer, while Hong Kong tycoon Richard Li’s FWD Group and, separately, Prudential Plc have also bid, according to the people. Bidders for SCB Life Assurance Pcl are expected to be shortlisted this month, said one of the people, who asked not to be identified because the process is private.

A deal could give the life insurance business a valuation of at least $3 billion, people with knowledge of the matter said in April. Siam Commercial, Thailand’s third-largest lender, has been considering selling a stake in the operations as well as granting access to sell insurance products through its branches, the people said at the time.

Global insurers have been seeking ways to expand their reach selling products via lenders with large Asian branch networks. German’s Allianz SE announced a 15-year agreement last month to distribute products through Standard Chartered Plc’s outlets in Asia. Sompo Holdings Inc.’s so-called bancassurance agreement last year gives the Japanese firm access to CIMB Group Holdings Bhd. branches in Southeast Asia.

Big Deal

A deal for the SCB unit -- at a $3 billion valuation -- could be bigger than Li’s $2.1 billion acquisition of ING Groep NV insurance units in 2013 that created FWD Group, according to Bloomberg-compiled data. Li’s deal for operations in Hong Kong, Macau and Thailand is the largest insurance purchase that includes Southeast Asian assets, the data show.

Any stake sale would follow $2.2 billion of investments in Thai financial firms over the past 12 months, up from $738 million during the preceding period, according to the data.

Representatives for AIA, FWD, Prudential and Great Eastern declined to comment, while a representative for Manulife said the company doesn’t comment on market rumors in an e-mailed response to Bloomberg queries. Siam Commercial President Arthid Nanthawithaya declined to comment when reached on his mobile phone, while calls to Charoen’s office went unanswered.

Siam Commercial in 2015 bought the remaining shares it didn’t already own in SCB Life in a deal valuing the insurer at about 77.8 billion baht ($2.2 billion). The lender has more than 1,000 branches across the country, according to its website.

Insurer Great Eastern, controlled by Oversea-Chinese Banking Corp., has a presence in Indonesia, Brunei, China and Myanmar, in addition to its biggest markets in Malaysia and Singapore, according to its 2016 results. It agreed to sell its Vietnam operations to FWD, the insurance arm of Pacific Century Group, last year, according to Bloomberg-compiled data.

FWD last year also bought a 90 percent stake in Singapore’s Shenton Insurance Pte and agreed to buy Tokyo-based AIG Fuji Life Insurance Co., according to its website.

    Before it's here, it's on the Bloomberg Terminal.