Singapore: OCBC Wing Hang Bank sells stake in Hong Kong Life for S$425.8m

Hong Kong cityscape. Image Credit: Wikimedia Commons

Oversea-Chinese Banking Corporation Limited (OCBC Bank) is divesting its stake in insurance firm Hong Kong Life with a sale to First Origin International Limited.

OCBC’s wholly-owned subsidiary, OCBC Wing Hang Bank Limited (OWHB), sold its 33.33 per cent stake in the insurance company, comprising 140 million ordinary shares in the share capital of Hong Kong Life Insurance Limited (Hong Kong Life) to First Origin International Limited. The consideration for the Sale Shares is HK$2,366.7 million (~S$425.8 million), payable in cash.

Incorporated in Hong Kong, First Origin is an investment holding company with a focus on investment in the financial and technology sectors in Asia. The divestment was part of an acquisition by First Origin, which paid a consideration of HK$7.1 billion (S$1.27 billion) for the entirety of the enterprise.

Other sellers involved in the transaction were Asia Financial Holdings, through its subsidiary Asia Insurance, Chong Hing Insurance, Shanghai Commercial Bank and Wing Lung Agency. The four firms and OCBC Wing Hang had first launched Hong Kong Life as a joint venture (JV) in 2001.

In a filing with the Hong Kong Stock Exchange on Monday night, Asian Financial Holdings stated: “The sellers believe it is in the best interests of Hong Kong Life to have one new single shareholder to take charge to grow its business in line with its customers’ evolving needs.”

According to a stock exchange announcement by OCBC, the unaudited net asset value, as well as the unaudited net tangible asset value, of Hong Kong Life was HK$793.0 million (S$142.6 million) as at 31 December 2016, with the consideration determined after arms’ length negotiations between the parties following an auction process.

The completion of the sale of the sales is conditional upon regulatory approvals. Upon completion of the sale, Hong Kong Life will cease to be an associated company of OWHB and OCBC Bank. However, OWHB shall be distributing products of Hong Kong Life in Hong Kong.

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