Maybank to take full control of Etiqa after buying Ageas’ stake for US$1.2 billion

[KUALA LUMPUR] Maybank has agreed to buy out Belgian insurer Ageas’ minority stake in Etiqa, a move that would give Malaysia’s biggest lender full ownership of the South-east Asian insurer.

The Kuala Lumpur-listed bank plans to buy the roughly 31 per cent stake in Etiqa owned by Ageas for about RM4.83 billion (US$1.2 billion), according to a statement on Monday (Aug 3), which confirmed an earlier Bloomberg News report.

The acquisition is subject to approvals from Bank Negara Malaysia, the country’s central bank. It is expected to be completed in 2026, pending regulatory approvals, Ageas said in a separate statement.

Ageas will have an estimated net capital gain after tax of about 450 million euros (US$519 million), the Brussels-based insurer said in that statement. 

It had entered the Malaysian market in 2001 through a joint venture with Maybank, and expanded its operations into Singapore in 2014.

Ageas CEO Hans De Cuyper said the divestment “allows us to capture the significant value that has been generated together with our partner Maybank throughout this period”.

Asia is one of the company’s four core segments along with Belgium, Europe and reinsurance, he added.

At a media briefing on Monday, Maybank president and group CEO Khairussaleh Ramli said the lender believes “now is the right time for us to move into the next phase of growth” for the joint venture between Maybank Ageas Holdings and Etiqa.

The purchase price is after adjustment for an RM800 million dividend proposed to be paid by Maybank Ageas Holdings on completion. Ageas will be entitled to RM248 million of the dividend, while RM552 million will go to Maybank.

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Maybank said it will fund the acquisition through internal and external sources.

The lender added that the deal would immediately increase its profit attributable to shareholders, earnings per share and return on equity. It also expects the full ownership to help it manage capital more efficiently and support its existing dividend policy.

Maybank had been considering options including buying out Ageas’ minority stake in Etiqa, people familiar with the matter previously said.

The deal would give the whole of Etiqa an overall valuation of roughly US$4 billion, the people added.

Etiqa has more than 6,000 agents and 23 branches, offering both conventional and syariah-compliant insurance products across multiple distribution channels in Malaysia, Singapore, the Philippines, Indonesia, and Cambodia, according to its website.

Its insurance and takaful businesses in Malaysia grew at an annual rate of 7.3 per cent over the past decade, compared with 4.6 per cent for the industry, Khairussaleh said. Its life insurance and family takaful business grew 9.2 per cent, against industry growth of 6.9 per cent.

Maybank aims to lift Etiqa’s premium growth to a 15 per cent compound annual rate and raise the contribution from bancassurance – insurance sold through its bank channels – to 50 per cent of total premiums by 2030, from about 40 per cent now, Khairussaleh added.

Maybank shares have gained almost 4 per cent this year, giving the bank a market value of around US$32 billion.

Ageas, based in Brussels, has climbed about 20 per cent this year, valuing the insurer at around US$17 billion. BLOOMBERG, REUTERS