Thursday, February 3, 2011
Japan's Mitsui says eyes stake in Malaysian Islamic insurer
Tokio Marine is expected to sell its stake in Hong Leong Tokio Marine to the Malaysian shareholder which would then sell it on to Mitsui Sumitomo, both pending regulatory approval, a source said.
Japan's Nikkei newspaper had earlier reported that Tokio Marine was planning to exit its partnership in Hong Leong Tokio Marine due to differences in business strategy. While Tokio Marine wants to sell a broad lineup of life and non-life insurance, Hong Leong is keen to focus on savings-type policies, the paper said.
Mitsui Sumitomo has been looking to expand its overseas operations by forging tie-ups with peers in emerging markets as Japan's non-life insurance market shrinks.
Mitsui Sumitomo Insurance managing executive officer Masaaki Nishikata told Reuters in September that MS&AD Insurance was in talks to buy into several life insurers in Asia as it aims to tap the region's growing economies.
A unit of Tokio Marine halted talks with Malaysia's PacificMas to buy medical insurance provider Pacific Insurance Bhd last July.
The market for Islamic insurance, or takaful, is expected to grow in tandem with rising demand for ethical investments. Total takaful contributions could reach $7.7 billion a year by 2012, Ernst & Young has forecast. But global takaful contributions are less than 1 percent of the total insurance premium spend annually, industry lawyers Clyde & Co have said. ($1 = 81.335 Japanese Yen) (Click on for more Islamic finance stories and for a speed guide) (Reporting by Taiga Uranaka; writing by Liau Y-Sing; editing by Lincoln Feast)
Courtesy by: Reuters