Takaful Malaysia to sell its stake in Indonesian subsidiary

Takaful Malaysia today announce the group financial results and growth strategy at their Takaful Malaysia Building in Kuala Lumpur on March 7, 2012.

KUALA LUMPUR: Syarikat Takaful Malaysia Bhd (STMB) will be pocketing 7 billion rupiah (RM2.19mil) by selling its 64.7% effective equity interest in Indonesia-based PT Asuransi Takaful Umum (ATU), a general takaful operator that was initially targeted for liquidation.

In a statement to Bursa Malaysia on Friday, STMB said the proposed sale came after some potential investors expressed interest to acquire ATU, which is held via its subsidiaries,  PT Syarikat Takaful Indonesia (STI) (29.49%) and PT Asuransi Takaful Keluarga (ATK) (35.21%).

“Therefore, the board of directors of Takaful Malaysia, upon further deliberation on the best available option for ATU, decided to accept an offer from Koperasi Simpan Pinjam Jasa (Kospin), M Andy Arslan Djunaid SE and Bahroji for the disposal of ATU for a total consideration of 7 billion rupiah instead of proceeding with the earlier proposed members’ voluntary liquidation,” it said.

STMB, which is a 59.7%-owned subsidiary of BIMB Holdings Sdn Bhd, said a conditional shares sale and purchase agreement was signed on Oct 27 between the purchasers and ATU shareholders comprising STI, ATK and Koperasi Karyawan Takaful (Kopkar).

The proposed disposal is subject to the approval from the Indonesian Financial Services Authority and the shareholders of STI, ATK and Kopkar.

As at June 30 last year, Takaful Malaysia’s indirect cost of investment in ATU, which was incorporated in 1994, was RM9.8mil while the carrying value was RM9.3mil.

The decision to sell off ATU was due to "the constraints and limitations faced by ATU, especially in term of capital requirement in order to compete effectively with other general insurers due to the presence of the numerous takaful ‘Islamic window’ operations in Indonesia, which has put the full-fledged syariah compliant operators at a significant disadvantage compared to its competitors due to higher operating cost."

STMB said the group’s expected loss from the proposed disposal would be about RM4.8mil.

Interestingly, in its Aug 17, 2016 announcement to the exchange, STMB said the group’s expected losses from the proposed members’ voluntary liquidation would be RM3.5mil.