KUALA LUMPUR: Affin Holdings Bhd
is seeking Bank Negara Malaysia’s approval to acquire 7.07% equity interest in AXA Affin General Insurance Bhd (AAGI) from Felda Marketing Services Sdn Bhd for RM99.09mil in cash - short of the 16% stake that it was eyeing earlier.
In a filing with Bursa Malaysia, the financial services group said it submitted an application to the central bank on Friday to seek its nod to purchase 8.412 million ordinary shares in AAGI - which comes to about RM11.78 per share - and to enter into a share purchase agreement (SPA) with Felda Marketing Services for the proposed acquisition.
Affin, however, did not say why it was only purchasing part of the earlier-targeted 16% stake.
“Further details on the proposed acquisition will be announced later upon the execution of the SPA after the approval of BNM has been obtained,” it said.
The purchase, if approved, will boost Affin’s stake in AAGI from 36.94% to 44.01%. (According to Affin’s latest annual report, it had last year acquired an additional 2.43% stake in the general insurer at RM6.77 per share.)
Affin had in March last year received Bank Negara’s go-ahead to start negotiations with Felda Marketing Services, AXA Asia and subsequently the minority shareholders to acquire the additional AAGI shares.
In February, BNM informed Affin that it had no objection for an extension of six months up to Aug 5 (Saturday) for Affin to complete its negotiations with Felda Marketing Services and AXA Asia in relation to the proposed deal.
At Affin’s AGM in April, Affin group chief executive officer Kamarul Ariffin told reporters that the Armed Forces Fund Board’s financial services arm expected to finalise the purchase of an additional 16% stake in AAGI by that deadline.
AAGI closed 2016 with a gross written premium of RM1.47bil, up 9.8% from RM1.33bil in 2015. It posted a group net profit of RM132.7mil for the financial year ended Dec 31, 2016, a 60% jump from the preceding year, which translates into basic earnings per share of RM1.11 (FY15: 70 sen).