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Mitsui Sumitomo Insurance buying Singapore property, casualty insurance firm First Capital Insurance
MITSUI Sumitomo Insurance (MSI) is buying Singapore's largest property and casualty insurance company First Capital Insurance from Fairfax Financial Holdings for US$1.6 billion to further cement its leading position in Asean's non-life insurance market.
MSI will acquire Toronto-based Fairfax's 97.7 per cent interest in First Capital Insurance which was incorporated in 1950, it said on Thursday. MSI said it will also enter into a global partnership with Fairfax in various areas including reinsurance relationships and digital technologies.
First Capital Insurance which has 160 employees is headed by chief executive Ramaswamy Athappan.
The Japanese insurer has been growing its international business, in particular in high-growth markets such as Asia.
We have rapidly grown to become the top non-life insurer (as measured by direct written premiums) in the Asean region and expanded our operations centred on Asia, building on the momentum from our acquisition of the Asian non-life insurance operations of UK company Aviva, in 2004, said MSI.
"In order to maintain and strengthen our leading position in the Asean region as well as to complement our existing operation and achieve synergies, MSI will acquire First Capital Insurance, one of the leading players in the Singaporean non-life insurance market."
First Capital Insurance is the largest property and casualty insurance company in the Singapore market in terms of gross written premiums and a leading player in Singapore with annual profits of about seven billion yen (S$87.2 million).
In addition, First Capital Insurance has diversified underwriting risk portfolio across geographies and products with limited exposure to natural catastrophe risks, said MSI.
"The acquisition will enable us to become a No 1 insurer in Singapore non-life insurance market. The acquisition is highly complementary as First Capital has a strong presence and underwriting capability in the local corporate market which fits well with MSI who has a competitive advantage in retail and small and medium enterprise business."
MSI said it is the only non-life insurance company in the world with operations in all 10 Asean countries, and has the largest market share in terms of gross written premium for non-life insurance.
The deal is expected to complete January to March 2018, subject to regulatory approvals.