Australian listed insurance business Suncorp is understood to be weighing a sale of its New Zealand life insurance business, with investment bank UBS said to be close to the situation.
Sources believe that the unit may have a value of about $300m.
In New Zealand, Suncorp operates life insurance under the Asterton Life brand, which offers trauma, income protection, total and permanent disability and business cover.
It sold its Australian life insurance operations in 2018 to Japanese financial giant Dai-ichi for $725m.
At that time, other Japanese firms were underbidders for the business, including MS&AD and Meiji Yasuda.
Suncorp is understood to have a had a busy few weeks dealing with the mountain of claims linked to floods across Australia’s east coast.
The Brisbane-based insurer has been the last group standing in the competition to buy the Australian general insurance operations of Zurich, as revealed by DataRoom in January, after rival bidder Chubb left the race.
Some have suggested that a deal by Zurich to sell the business to Suncorp may be imminent, although sources close to Suncorp have suggested this not to be the case.
On offer since around October last year by Zurich has been the Australian operations, excluding the travel insurance unit.
Zurich invested heavily into travel insurance in Australia with the acquisition of the listed Cover-More Group in 2017 for $741m.
Earlier, sale price expectations were thought to be about $500m, although some believe that the business could be worth as much as $1bn.
Suncorp, with Barrenjoey on board, was said to be a keen buyer of CBA general insurance last year when it was up for sale.
At that time, it used investment bank UBS to chase the asset.
An acquisition was understood to have been challenging when it came to gaining permission from the Australian Competition and Consumer Commission.
This month, Suncorp told the market that it finalised the sale of its Australian Wealth business to LGIAsuper for $55m.
Last month, it said that at the end of March 28, it had received just over 41,900 property and motor claims across Queensland and NSW as a result of the flood events, with about 62 per cent of those lodged online.
It said that Suncorp remained well protected against such events and future events through its extensive reinsurance program, with the net retained financial loss from the recent events limited to $75m.
Suncorp’s market value is currently at $14bn with its shares closing at $10.82 on Wednesday.
Is it third time the charm for Star equity raising?
There’s talk Star Entertainment once again has an equity raising on its agenda.
Vulcan Steel seeks to expand footprint, with InfraBuild a target
Vulcan Steel has signalled it intends to seek out “new opportunities” to expand its footprint in Australia, and is eager to explore acquisitions.