Japan’s Sumitomo Life Insurance Company (Sumitomo Life) has agreed to acquire all shares in Singapore insurer Singlife held by private equity giant TPG, according to an announcement.
Singlife said Sumitomo Life will also make an offer to buy the shares of all other remaining shareholders, giving the Japanese insurer 100% ownership of Singlife if the offers are accepted.
The deal values Singlife at S$4.6 billion (about $3.5 billion), making it one of the largest insurance deals in Southeast Asia to date. TPG, which invested in Singlife in 2020, owns a 35% stake in the company.
The acquisition announcement comes less than two months after Sumitomo Life increased its stake in Singlife with a capital injection of about $133 million, representing 4.92% of the Singapore insurer’s increase share capital.
In September this year, Sumitomo Life had agreed to buy a 25.9% stake in Singlife for around $1 billion from British insurer Aviva. The Japanese insurer sees Singapore as a key part of its Southeast Asia strategy.
“Singlife has been steadily expanding on the strength of its digital-enabled business with a wide range of products and sales channels. We have had a very good relationship with the Singlife management team and want to support their growth,” Sumitomo Life president and CEO Yukinori Takada said.
Singlife said Sumitomo Life, which first invested in the Singapore insurer in 2019, does not intend to change the operations of Singlife and has no plans to change the name, brand, or management team.
If the deal pushes through and is completed in Q1 of 2024, Singlife will become a wholly-owned subsidiary of Sumitomo Life.
“As a subsidiary of Sumitomo Life, we will have access to capital, a nimble shareholding structure, and be at the centre of a strategic plan to provide financial planning solutions for consumers in Southeast Asia,” said Singlife chairman Ray Ferguson.
Established in 1907, closely held Sumitomo Life had about 35.2 trillion yen in total assets as of the end of March, according to its website. It counted more than 44,400 employees.
Singlife, on the other hand, reported a net profit of about $193.4 million in 2022 against a loss of $95.86 million in 2021. The profit growth was attributed to strong underwriting results from its insurance portfolio and a financial reinsurance arrangement that the company entered into in 2022.
First announced in September 2020 and valued at S$3.2 billion, the merger of Aviva Singapore and Singlife was the largest insurance deal in Singapore then and created one of the largest homegrown financial services companies in the republic.