by Ernie B. Calucag
Japanese trading conglomerate Marubeni Corp will buy a 22-per cent stake in Singapore reinsurer ACR Capital Holdings in a move that will provide ACR with new capital and new business opportunities, the Singapore firm said on Friday.
The deal will help Marubeni grow in the insurance sector, the Japanese company said in a statement released by ACR. Marubeni has reinsurance-related businesses in Tokyo, Singapore and London.
ACR did not disclose the amount of Marubeni’s investment, but sources said it will pay around US$250.0 million (S$312.8 million), becoming a major shareholder alongside existing investors British private equity firm 3i, Malaysia’s Khazanah Nasional Bhd and Singapore state investor Temasek Holdings.
The deal is the latest in a growing list of insurance sector transactions in Asia by Japanese firms. MS&AD, Japan’s largest property-casualty insurer by revenue, recently struck a deal for a 26-per cent stake in Max New York Life, India’s sixth-largest life insurer based on premium income, for US$530.72 million.
Marubeni’s investment underlines its growing reinsurance ambitions and follows the launch last year in Singapore of its subsidiary business brokering between insurers and reinsurers.
“This investment enhances the capabilities of our existing reinsurance-related businesses operating in Tokyo, Singapore and London,” Hikaru Minami, chief operating officer of Marubeni’s finance, logistics & IT business division, said in the statement.
ACR’s business lines include providing reinsurance cover for ships, aircraft and large property risks in areas such as power generation, infrastructure, ports, electronics and semiconductors.
Marubeni’s investment will tap ACR’s risk management and underwriting capabilities.
ACR was set up in 2006 with capital of around US$620 million and has a presence in Hong Kong, Taiwan, Japan, Korea, India and Vietnam.
Barclays advised ACR on the deal.