April 24, 2024

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[THE INVESTOR] Shinhan Financial Group, the nation’s largest financial holding company in terms of assets, has recently started due diligence on local insurer ING Life Insurance for a possible acquisition, according to industry sources on March 9.

MBK Partners, the nation’s largest private equity firm, acquired ING Life from ING Group for 1.8 trillion won (US$1.68 billion) in 2013, becoming the largest shareholder with a 59.15 percent stake. As of last year, ING Life’s assets totaled 31.4 trillion won, the fifth-largest among local rivals.

MBK had sought to sell the insurer to Chinese buyers in 2016 but the attempt failed due to the high price and rising political tensions between Korea and China. In May last year, ING Life made its stock debut on the KOSPI market.

Sources say Shinhan considered a bid for ING Life last year but scrapped the plans in the early stage. Among others, the high price that could reach up to 3 trillion won is expected to be the key issue until the deal is closed.

“MBK has already recouped most of its initial investment through the IPO and dividends. Some price adjustments seem possible,” an unnamed source told Seoul Economic Daily.

Following the purchase, Shinhan is expected to combine the firm with its own insurer Shinhan Life Insurance for business synergies and increased revenue.

By Lee Ji-yoon (jylee@heraldcorp.com)