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MetLife seeking sale of Hong Kong insurance unit: sources
[HONG KONG] MetLife is seeking a sale of its Hong Kong insurance unit, joining international rivals including Axa and MassMutual that have pursued divestments in the Chinese territory, people with knowledge of the matter said.
New York-based MetLife is preparing to send out information on the Hong Kong business to prospective buyers in the next couple weeks, according to the people. The sale could raise more than US$600 million, one of the people said, asking not to be identified because the matter is private.
MetLife is the latest insurer seeking to cash in on a surge of buyer interest in a coveted Hong Kong insurance licence. Chinese companies have been pursuing acquisitions of life insurers and wealth managers in the city in a string of deals over the past three years, as they seek to cater to demand for investment-type products from mainland customers.
Axa agreed last month to sell its Hong Kong wealth management unit to a local family office, while a group led by tech billionaire Jack Ma's Yunfeng Financial Group said in August it would buy control of Hong Kong-based MassMutual Asia for US$1.7 billion.
A representative for MetLife declined to comment.
MetLife Hong Kong has an embedded value of around US$400 million, according to the people familiar with the matter. The company could fetch a similar valuation multiple to that achieved with previous disposals such as the Axa sale, the people said. MetLife remains committed to its other Asian operations, including those in South Korea and Japan, one person said.
Shares of MetLife have risen 12 per cent in US trading over the past year, giving the company a market value of about US$56.7 billion. The benchmark S&P 500 Index gained 25 per cent over that period.
MetLife has boosted its business from mainland clients and now ranks as Hong Kong's 14th largest insurer by total new business in the first nine months of 2017, according to Bloomberg Intelligence analyst Steven Lam, up from 17th in the same period a year earlier.