Up to one quarter of the ING's insurance arm is going under Asian ownership

8 May 2014 — Daniela GHETU
ing3An Asian consortium of three companies formed by TEMASEK Holding, a state owned investment company from Singapore, its subsidiary SEATOWN Holdings International and RRJ Capital - a private investment fund owned by the Malaysian businessman Richard ONG - will invest about EUR 1.3 billion in NN Group, the insurance arm of ING Group for Europe and Japan. According to Financial Times analysts, depending on the total value sales price of NN Group, which can vary between 5 and 8 billion Euros, the investment could secure for the Asian consortium a share of 15 to 25% of the Dutch insurance group.

The operation will take place before the NN public offering's (IPO) onset planned for this year. Under the agreed terms, ING will receive cash amounts of EUR 750 million from RRJ, EUR 425 million from TEMASEK and EUR 100 million from SEATOWN and will assign each of the three buyers a stake of EUR 150 million at the planned NN Group's public offering and also to issue to these three investors subordinated notes that ING Group will over time exchange into NN Group shares.

As previously announced, ING Group is preparing NN Group, which comprises ING Group's European and Japanese insurance and investment management operations, for a base case IPO. Preparations are on track for a transaction in 2014, depending on market circumstances. Further announcements on the base case IPO of NN Group, including the capital structure, will be made as and when appropriate. If the IPO does not take place in 2014, the transactions with these three investors will be unwound, and the subordinated notes will be redeemed.

The investment adds to Temasek's insurance "presence in central, eastern and the rest of Europe, as well as operations in Japan," said Stephen Forshaw, a spokesman for the investment company, quoted by Bloomberg. NN Group has insurance operations in Europe cover the Netherlands, Poland, Turkey, Czech Republic, Slovak Republic, Romania, Hungary, Bulgaria, Belgium, Spain, Greece and Luxembourg. The Group also holds life insurance operations in Japan and includes ING's asset-management division.

RRJ Capital is an Asia-based investment management company. It currently manages two private equity funds with a combined size of USD 5.9 billion. RRJ Capital strategically focuses on the following sectors: Financial Institutions, Consumer, Energy, Food and Industrials.

Incorporated in 1974, TEMASEK is an investment company based in Singapore. Supported by 11 offices globally, Temasek owns a USD 173 billion portfolio as at 31 March 2013, with more than 70% of its underlying assets in Asia (including Singapore). The investor's interest for the European business opportunities grew lately, TEMASEK recently opening a European office in London.

SeaTown, based in Singapore, is a wholly-owned subsidiary of Temasek and was established in 2009 as an investment manager focused on absolute returns. SeaTown seeks to achieve consistent, superior risk-adjusted investment returns with its core strategy in value investing across the capital structure in companies globally.

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