Liberty Mutual Insurance is disclosing acquisition plans for the second time in two weeks. This time, the Boston-based mutual insurance holding company said it will apply for regulatory approval to acquire Malaysian insurer AmGeneral Insurance Berhad, a deal that would make it the largest auto insurer in Malaysia. Neither side disclosed financial terms.
On July 12, Liberty Mutual said it would pay about $1 billion for State Auto Group, a super-regional insurance holding company based in Columbus, Ohio.
In Malaysia, AmGeneral is currently 51 percent-owned by AmBank Group and 49 percent-owned by Insurance Australia Group (IAG). Pending regulatory approvals, Liberty Insurance Berhad (its Malaysia arm) will acquire all shares of AmGeneral, and AmBank Group’s share of the sale proceeds will be in the form of cash and consideration shares. This will result in AmBank Group holding a 30 percent interest in the Liberty Insurance Berhad and AmGeneral businesses.
The AmGeneral and Liberty Insurance Berhad operations will be formally merged sometime in the future. Following the merger, it is expected that the combined entity will become the largest auto insurer and second-largest property and casualty insurer in Malaysia based off of 2020 data, according to the deal announcement.
As part of the transaction, the prospective merged entity will form an exclusive 20-year bancassurance partnership with AmBank Group to distribute general insurance products.
“Expanding and investing in international insurance markets is instrumental in our aspiration to become a leading global property and casualty insurance company,” said Jim MacPhee, Liberty Mutual’s president of Global Retail Markets. “Combining Liberty’s global capabilities with AmGeneral’s leading market share in auto and a growing business in additional product lines will create a best-in-class insurance operation.”
AmGeneral serves the Malaysian insurance market through approximately 1,400 employees at 33 branch locations. A top three motor insurer with a growing business in additional product lines, the company distributes its personal and commercial insurance products under the AmAssurance and Kurnia brands through more than 6,000 agents, brokers, car dealers, franchises and affinity partners, and its fast-growing digital and direct capabilities.
Citigroup, Inc. acted as financial advisor to Liberty Mutual in the transaction.
Source: Liberty Mutual