Italy-based Generali has signed an agreement with MPHB Capital wholly-owned subsidiary Multi-Purpose Capital Holdings Berhad to acquire a 49% interest in its P&C insurance subsidiary, Multi-Purpose Insurans Berhad (MPIB), for around €81.4m (MYR355.8m).
Generali noted that the acquisition allows the company to enter the Malaysian market, placing itself among the top ten P&C insurers of the country.
The deal includes a call option exercisable in two years on an additional 21% stake of MPIB, which will allow Generali to increase its holdings to 70% of the company’s capital.
Generali Group CEO Mario Greco said: "Our entry into the Malaysian market marks an important step for Generali’s development in Asia, an important area for the Group’s future growth and where we are already investing.
"Malaysia is a market which is significantly growing and offers great opportunities, especially in the P&C segment."
MPIB reported premium income of €128m in 2013 and it registered a yearly premium growth of 8%, during the last four years.
Its diversified portfolio includes motor with 27.3%, fire with 21.7%, medical and contractors all risk each with 6.8%.
Subject to the approval of MPHB Capital’s shareholders, the transaction has been approved by the local regulator, Bank Negara Malaysia.
In Asia, Generali already operates in nine countries with a 2013 premium income of about €1bn. The countries include China, Hong Kong, India, Indonesia, Japan, Philippines, Singapore, Thailand and Vietnam.
Image: Generali to enter the Malaysian market with the acquisition of MPIB. Photo: courtesy of Stuart Miles.