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Categorized | Insurance

AIG sells Japan life insurance business to Pacific Century

Posted on November 15, 2016

Richard Li, the Hong Kong entrepreneur who is the son of one of Asia’s richest men, has struck a deal to buy AIG’s remaining life assets in the continent as he moves to build a challenger to the region’s more established operators.

FWD Group, the insurance arm of Mr Li’s Pacific Century Group, has agreed to acquire AIG’s Japan life business.

Terms of the transaction were not disclosed, but the business, AIG Fuji Life Insurance (AFLI), had assets of less than $5bn as of the end of March. AIG has total assets of about $515bn and a market capitalsation of $66.3bn.

Mr Li is the son of Hong Kong billionaire Li Ka-shing. Since 2013, FWD has grown its footprint in life insurance across Thailand, Indonesia, the Philippines, Singapore and Vietnam, with a strong base in Hong Kong and Macau. FWD’s entry into Japan, which is the world’s second-biggest life insurance market, “further extends its regional footprint and is part of its vision to become a leading pan-Asian insurer”, the company said in a statement.

The deal is small in the context of AIG, although it is symbolically significant for the New York-listed insurer, which has been under pressure to improve returns from the activist investors Carl Icahn and John Paulson.

Peter Hancock, AIG’s chief executive, said:

Like other actions we’ve taken this year, the sale of AIG Fuji Life makes us a leaner insurer that’s better focused on the geographies and segments where we have the critical mass and expertise to provide tremendous value to our clients.