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Fubon Life's Hyundai Life stake deal approved

Fubon Life's Hyundai Life stake deal approved

Fubon Life Insurance Co., the main life insurance subsidiary of Fubon Financial Holding Co., has received the green light from South Korea's financial regulator to acquire a stake in a Korean life insurer.

The Financial Services Commission of South Korea has approved Fubon Life's acquisition of a 48 percent stake in Hyundai Life Insurance Co. to become the second largest shareholder of the insurer, trailing only Hyundai Motor Group, which has a 50.2 percent stake.

The Korean authorities have also agreed that Fubon Life will take five of the 11 seats on Hyundai Life's board, with Hyundai Motor Group holding the other six.

Fubon Financial said the deal, which is expected to be closed on Dec. 7, will help the Taiwanese financial services company extend its reach into the East Asian market, in line with government policies to encourage local financial institutions to expand regionally through mergers and acquisitions.

In a statement released Friday, Fubon Financial Vice Chairman Richard Tsai said the acquisition of the Hyundai Life stake will boost Fubon Life's presence in Asia following its founding of a Vietnamese subsidiary in 2011. It has also received approval to open a unit in Hong Kong.

Once the deal is concluded, Fubon Life will send a team of asset management, risk management, finance and product development specialists to Hyundai Life to help the Korean unit expand its business, Fubon Financial said.

Fubon Life will also be able to contribute its experience in overseas investments to help strengthen Hyundai Life's investment returns and lower investment risks, Fubon Financial said.

Lee Joo-hyuk, president of Hyundai Life, said in the statement that he looked forward to the synergies to be created by the strategic partnership and expects Fubon Life and Hyundai Life to become the best business partners in the long term.

According to Fubon Life, the life insurance business in South Korea is the second largest financial services sector in the country after banking.

Known as Green Cross Life Insurance before being acquired by the Hyundai Motor Group in 2012, Hyundai Life currently has 51 outlets in South Korea and more than 2,300 employees.

It has posted a 51 percent increase in monthly initial premium income and a 49 percent increase in gross premium income so far this year.

Fubon Financial said Hyundai Life hopes to become one of South Korea's top 10 insurers by 2020. (By Tien Yu-pin and Frances Huang)

Updated : 2021-09-24 08:46 GMT+08:00