Vietnam: Ageas, Muang Thai Life & Military Bank set up life JV
Source: Asia Insurance Review | Sep 2015
Ageas, which is Belgium’s largest insurer, and Muang Thai Life Assurance have signed an agreement with Vietnam’s Military Commercial Joint Stock Bank (“Military Bank”) to establish a joint venture in the country, which will be named MB Ageas Life.
Under the agreement, Ageas will have an equity shareholding of 29% in the new company; Muang Thai Life Assurance 10%, and Military Bank 61%. It was further agreed that Military Bank and MB Ageas Life will enter into a 15-year exclusive bancassurance agreement.
The total capital investment for the three partners will amount to around EUR46 million (US$50.5 million), according to a statement issued by Muang Thai Life. All shareholders will contribute in proportion to their shareholding. This represents a capital investment for Ageas of EUR13.4 million, Muang Thai Life of EUR4.6 million, and Military Bank of EUR28 million. Ageas will also have an indirect shareholding of 3.1% in the new company via Muang Thai Life.
Subject to regulatory approvals and customary closing conditions, the transaction is expected to be completed by the end of this year and MB Ageas Life is expected to commence operations in 2016.
MB Ageas Life’s goal is to become a premier bancassurance company in Vietnam. The new insurer will also set up a high quality agency distribution network. The joint venture will benefit from Military Bank’s network of 217 branches with more than 2 million customers while leveraging the insurance expertise of Ageas and Muang Thai Life.