Tuesday 19 Mar 2024
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KUALA LUMPUR (Dec 9): Affin Bank Bhd has inked a business transfer agreement (BTA) to merge its general insurance business in Malaysia under AXA Affin General Insurance Bhd or AAGI with Generali Asia NV's, which will result in Affin Bank holding a 30% stake in the enlarged insurance company, with Generali controlling the remaining 70%.

The agreement comes after Affin Bank completes the partial disposals of its equity interests in the joint ventures AXA Affin Life Insurance (AALI) and AAGI to Generali, which acquired a 70% stake in the former (49% from AXA and 21% from Affin Bank) and 53% in the latter (49.99% from AXA and 2.95% from Affin Bank).

The disposals saw the exit of AXA from the JVs and made Generali the new JV partner for Affin Bank in the insurance operations.

In announcing the completion of the disposals in August, Affin Bank said the pair planned to integrate the businesses of MPI General Insurance (MPIG) and AAGI, with Affin Bank holding 30% equity stake in both AALI and AAGI upon full integration.

In a Bursa Malaysia filing on Friday, Affin Bank announced that the business transfer agreement to effect the merger has been signed with Generali Asia, MPIG and AAGI.

AAGI will issue 67.46 million shares of AAGI (representing 36.71% of the enlarged and paid up share capital worth RM765 million of AAGI after the issuance of the shares to Generali Asia) to complete the merger.

"The proposed merger will result in a dilution of Affin’s shareholding in AAGI from 47% to 30% in the enlarged AAGI," it said.

The merging parties will make a joint application no later than 30 days from the date of the business transfer agreement to give effect to the business transfer scheme.

“Subject to the court order being obtained, the completion of the sale and purchase of the business shall take place at 0001 hours on Feb 28, 2023 (or notwithstanding anything else to the contrary, such other date as may be ordered by the High Court) whereby the business shall be transferred from MPIG to AAGI,” said Affin Bank.

At market close, Affin Bank Bhd’s share price remained unchanged at RM2.06, giving it a market capitalisation of RM4.56 billion.

Edited ByTan Choe Choe
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