Zurich Insurance is mulling options for its Malaysian life insurance unit in order to comply with a local cap on foreign ownership. One option is to sell a stake through an initial public offering.
Zurich Insurance, one of Switzerland’s top insurers, is evaluating options of how to reduce its stake in the Malaysian life insurance unit, according to a report by «Bloomberg» on Thursday. The move comes after the government of Malaysia said it would start enforcing a 70 percent rule on foreign ownership.
The options include an initial public offering of a 30 percent stake in the unit that may fetch as much as $100 million, according to the report. Another way to comply with the rule would be to simply sell the stake to a local firm, such as the country’s two biggest pension funds, which already said they would bid to take such stakes.
In Good Company
Zurich is the latest of a string of overseas companies to mull ways to comply. Insurers Prudential and Chubb have been working with banks to find similar solutions.
Zurich didn’t comment the report, according to «Bloomberg». The Swiss company earlier opted to separate the general and life insurance businesses in the country to comply with regulatory requirements. Zurich Insurance Malaysia had net premiums of about $180 million in 2016, according to the report.
