Singapore-based insurer NTUC Income has forged a strategic partnership with Temasek-owned Fullerton Fund Management Company that will see the latter become the investment manager of its portfolio assets estimated at S$23 billion ($17.05 billion).
The transaction is subject to regulatory approvals and other customary closing conditions.
The strategic partnership will see Fullerton’s holding company, FFMC Holdings Pte Ltd, issue new shares to NTUC Income, granting it a significant minority stake in FFMC. Temasek Holdings, Singapore’s state investor, remains the majority stakeholder. The deal is not a merger and will see both remain autonomous entities.
Additionally, if successful, the partnership will render Fullerton one of the largest locally-owned asset management companies in the city-state; its assets under management (AUM) will grow to more than S$40 billion ($29.6 billion), up from S$17.3 billion ($12.8 billion) as at 30 September 2017.
To ensure continuity in the management of assets at both firms, relevant NUTC Income fund management employees will be transferred to Fullerton as part of the deal.
In a statement, NTUC Income’s chief executive Ken Ng said, “As a responsible and forward-looking organisation, Income is always looking out for opportunities to create more value for our policyholders.”
“We believe this proposed partnership with Fullerton is in our best interest to leverage economies of scale and tap the established and deep investment expertise of our combined investment capabilities to serve our policyholders better.”