The financial services business will spend €487m on the acquisition
Axa has agreed to sell Axa Insurance Pte – also known as Axa Singapore – to HSBC Insurance (Asia-Pacific) Holdings, a wholly owned subsidiary of the Hongkong and Shanghai Banking Corporation.
Under the terms of the agreement, HSBC will pay a total cash consideration of €487m (£414m) for Axa’s Singapore business.
The transaction, which is subject to closing conditions and regulatory approvals, is expected to close by quarter four of 2021.
According to Gordon Watson, chief executive of Axa in Asia and in Africa, the deal marks “another step in Axa’s simplification journey”.
He continued: “In line with the group’s strategy, we are focusing on our core markets where we have the size, presence in the right business segments and a strong potential to grow.
“We have in Asia a unique set of assets across established and high potential markets where we are deploying our vision, notably in health and protection, bringing high value products and services to our customers.
“I would like to thank the management team and all the employees of Axa Singapore for their strong contribution and commitment over the years and wish them every success for the future.”
The acquisition is predicted to result in a negative net income impact of €160m in Axa Group’ s full year 2021 consolidated financial statements.
Axa Singapore is offers life and savings (L&S), health and property and casualty (P&C) solutions to around one million customers. According to the General Insurance Association of Singapore, the insurer ranks 5th in the Singapore P&C market and has a 4% market share.
The company currently distributes its products mainly through a mix of agents and local partnerships.
The gross revenues and underlying earnings of Axa Singapore recorded in the Axa Group’s FY20 consolidated financial statements were €579m and €20m respectively.