Japanese insurer Dai-ichi Life Holdings has acquired New Zealand firm Partners Life as a wholly owned subsidiary.
Under the terms of the acquisition, Partners Life will become a part of the consolidated group of Dai-ichi Life Holdings.
It currently has 268 employees, was established in August 2010, and has a premium income of NZ$$370 million (US$238 million).
In a statement, Dai-ichi Life Holdings said, “Partners Life became profitable within its first five years of operations and grew rapidly to become the second largest player in the New Zealand life insurance market in its tenth year of operation.
“We believe that the acquisition will be part of our efforts towards achieving our mid-term plan to ‘reduce the cost of capital’ by further increasing the share of insurance risks, ‘expand’ our protection business, and ‘explore’ the possibility of acquiring digital and organizational capabilities.”
In the same statement, it also said, “The acquisition marks our entry into the third country within developed markets, which is the first time since the acquisition of Protective Life in the US in 2015, and the ninth country for our overseas business as a whole.
“The New Zealand market is expected to contribute to the company by supplementing and stabilising our overseas business profits while diversifying our business geographically. Key market features include: 1) relatively low insurance penetration of less than 1%; 2) highly profitable products for protection and personal insurance; and 3) relatively small but stable growth expectations, due to a proactive immigration policy and GDP per capita that exceeds that of Japan.”
Dai-ichi Life Holdings said that it would acquire 100% of Partners Life’s shares through an intermediary holding company that it would inject capital into.
The acquisition price will be NZ$980 million and it is estimated to complete between December and April next year, according to Reinsurance News.