Prudential buys AIA
American International Group (AIG) has sold its Asia Pacific life insurance business, AIA, to UK-based insurer Prudential for US$35.5 billion (A$39.42 billion).
According to AIG, the deal includes all of the companies of the AIA Group operating in the 15 geographical markets across Asia Pacific, including Australia.
As part of the deal, Prudential will pay US$25 billion in cash and US$10.5 billion in stock and other securities for AIA Group
AIG has announced that it will use the cash component of the sale to repay existing debts to the Federal Reserve Bank of New York, as part of the bailout of the insurer by US taxpayers during the global financial crisis.
“We decided that a sale to Prudential would enable AIG to realise value on a faster track so we could repay US taxpayers,” said AIG president and chief executive officer Bob Benmosche. “This transaction, the most significant milestone to date in our ongoing effort to repay taxpayers, also gives us greater flexibility to move forward with AIG’s restructuring and focus on enhancing the value of our key insurance businesses, which will benefit all stakeholders.”
The AIA Group has branch offices, subsidiaries and affiliates located in Australia, Brunei, China, Hong Kong, India, Indonesia, Macau, Malaysia, New Zealand, the Philippines, Singapore, South Korea, Taiwan, Thailand and Vietnam.
AUTHOR
Mike Taylor
Recommended for you
As the industry navigates the fallout from recent product failures, two major AFSLs have detailed their APL selection process and relationship with research houses, warning a selection error could “destroy” a licensee.
The impending retirement of financial advisers in their 50s could see the profession face significant succession challenges over the coming decade and younger advisers may not be the answer.
With a third of AFSLs being solo advisers, how can they navigate key person risk and ensure they are still attractive propositions for buyers when it comes to their succession planning?
A quarter of advisers who commenced on the FAR within the last two years have already switched licensees or practices, adding validity to practice owners’ professional year (PY) concerns.
