Update: Zurich Starts Talks to Possibly Buy Takaful Player in Malaysia
June 19, 2015 by Ernesto Calucag
Zurich Insurance Group Ltd. said it has started preliminary negotiations with MAA Group Bhd. to buy the Malaysian group’s 75% stake in MAA Takaful Bhd.
Both parties have obtained approval from Bank Negara Malaysia to begin talks for the disposal of a majority stake in the takaful company, Zurich said in a statement.
Zurich, however, said here is no certainty an acquisition or offer will be made in the future. “This does not amount to a firm intention on the part of Zurich to make an offer to acquire a stake in MAA Takaful Bhd.,” it added.
If an agreement is reached, MAA in a separate statement said the group and Zurich would be required to get prior approval of the finance minister, with the recommendation of the central bank. This was in line with the Islamic Financial Services Act 2013, it said.
MAA Takaful is a joint venture between MAA Group and Solidarity Company BSC (C) of Bahrain.
According to its annual report, the company had net earned contributions of 429.5 million ringgit (US$114.6 million) in 2014, up 46% from 293.3 million ringgit in the previous year. It has about 10,000 agents and nine branches throughout Malaysia.
Zurich Malaysia is formerly known as Malaysian Assurance Alliance Bhd., a local composite insurer that Zurich bought from the same MAA Group for US$115 million (Best’s News Service, June 20, 2011).
Prior to entering Malaysia, Zurich expressed its intention to establish takaful presence in Malaysia and Saudi Arabia. In 2008, the group formed Zurich Takaful Co. Ltd., a Dubai-based joint venture with Abu Dhabi National Takaful Co.
